Mortgage Rates – improved this week as the price of Mortgaged Backed Securities (MBS) responded favorably to correct BLS job numbers and a weaker than expected CPI report. Raters are up approximately 0.25% from this time last year.
New Construction – the National Association of Home Builders (NAHB) Housing Market Index, which measures builder confidence, declined 6 pts to 45. This is below the 50pt threshold that signals expansion or contraction. Sales fell 6 points to 51, future expectations fell 9 pts to 51 and buyer traffic fell 4 pts to 30 – the lowest level since January. The May survey also revealed that 25% of builders cut prices to bolster sales in May. This number is up from the previous report at 22%.
Inflation – the Consumer Price Index (CPI) report for March showed that overall inflation rose 0.3% for the month and year over year declined from 3.5% to 3.4%. The Core rate, which strips out energy and food, also increased 0.3%. Year over year Core CPI is down 0.2% to 3.6%. Used car prices fell 1.4% while new cars fell 0.4%
Mortgage Applications to purchase homes decreased 2% from last week. Purchase applications are down 14% year over year. Refinances increased 5% last week and are up 7% from this time last year.
Consumer Debt – credit card debt has bumped up significantly. In the last 3 years balances have increased by 50% while interest rates have simultaneously increased on cc debt from 11% – 25% (on average) in the same time period. In some demographics 12-15% of folks are maxed out on their ccs. now nearly 7% of folks are in serious delinquency (90+ days late).