AgentIndustry News

Economic strength puts pressure on real estate rates

Future-Proof: Navigate Threats, Seize Opportunities at ICNY 2018 | Jan 22-26 at the Marriott Marquis, Times Square, New York

Beware good news...very strong economic data on Friday were pushing mortgage rates higher, fixed-rate 30s still under 6 percent for the lowest-fee packages, but just barely. ARMs are under even more pressure, as the intermediate 5-, 7- and 10-year hybrids are all between 5.5 percent and 6 percent. Friday morning's report of 3.4 percent GDP growth in the 2nd quarter understated the true strength. Business "final sales" leaped 5.8 percent, the variance above GDP largely filled by a drawdown of inventories; the resulting inventory shortage all but guarantees a boost in production and fast growth in the next quarter. Other data confirmed the healthy pattern: orders for durable goods in the 2nd quarter raced ahead at an 8.3 percent annual rate, double the 1st quarter pace. Although icon companies (Kodak, HP) continue to announce big and permanent layoffs, new claims for unemployment insurance have fallen near the 300,000 mark, and the newest (excellent) housing data reinforced the Nation...