Mortgage Rates The price of mortgage-backed securities (MBS) improved marginally this week. More importantly, we broke above the 25-day moving average, and a close above that level today would mark the first meaningful stretch above the moving average since June. Rates are currently about 1/8% higher than they were at this time last year.
Retail Sales – the US Census Bureau released their Retail Sales report which showed a decline of 0.6% in July. Online sales declined 2.2% last month. Savings rates are near the lowest levels in history at 2.7%.
Inflation – the Bureau of Labor and Statistics (BLS) released their Consumer Price Index for July which showed headline inflation was essentially flat month over month, while year over year inflation declined from 3.5% to 3.4%. Gas prices declined 2.9% in July which helped with this report. The Core rate, which strips out food and energy prices, rose 0.2% in July while year over year it declined from 2.6% to 2.5%
Home Sales – the National Association of Realtors (NAR) released their Existing Home Sales Report for July which showed a decline of 1.7% to an annualized pace of 4.06M units. On a year over year basis home sales are up 0.7%. Homes are sitting on the market for an average of 29 days. First time homebuyers make up 29% of transactions while cash buyers comprise 26% and investors make up 14% of sales.
Home Values, despite higher interest rates, have remained resilient. Cotality reported that home values increased 0.3% in June and are up 1.2% year over year. Cotality is forecasting an increase of 0.2% in July (reports are always back dated 2 months for data collection) and 1.5% over the next 12 months. We’ll see if this was an error as last month they were forecasting 4.8% and that’s quite a delta.
Mortgage Applications to purchase home rose 3% while refinance applications rose 5% week over week. Year over year purchase applications are flat while refinance applications are down 22%.
Oil prices are at $81.83 up $3.61 from last week.