TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/106030
Month in review euphoria in the immediate aftermath of the fiscal cliff deal seems bound to give way to renewed concerns as we draw closer to the debt ceiling deadline," Bankrate stated. January 4 Employment Statistics in the Hot Seat Statistics in the Spotlight As the year's first financial reports were released, the marketplace reflected on past highs and woes—and gained insight into what's ahead for housing and the nation's economic environment. January 16 Beige Book Reveals Economic 'Expansion' Economic activity "expanded" in the closing weeks of 2012, the Federal Reserve said in its most recent Beige Book, reflecting a slow but steadily declining unemployment rate and low rates of inflation—conditions the Fed said would have to be met before it raises interest rates. According to the report, "real estate activity has expanded or remained firm in 11 districts for existing-home sales and leasing; eight districts for residential construction; 11 districts for nonresidential sales and leasing; and nine districts for nonresidential construction." The report went on to highlight regional performance, noting, "Growth in the Boston, Richmond, and Atlanta 14 | The M Report districts appears to have increased slightly, while the St. Louis district reports some slowing." three straight months of declines, and year-over-year, sales at furniture stores were up. 5.8 percent. January 15 January 10 Retail Sales Exceed Expectations Mortgage Rates Spike to Start 2013 Retail trade sales rose 0.4 percent in December, according to the latest survey from the Department of Commerce. The increase was twice the rate economists anticipated, and retail trade activity for the month rose 4.4 percent versus December 2011. The findings, however, revealed annual declines, with yearover-year growth falling from the 6.8 percent increase recorded during the previous December. Meanwhile, sales at furniture stores—an indicator of housing activity—rose 1.4 percent month-over-month, besting November's 1 percent improvement. The back-to-back gains followed Mortgage rates jumped during the first full week of January, as markets await additional fiscal drama set to unfold in the next few months. According to Freddie Mac's Primary Mortgage Market Survey, the average rate on a 30-year fixed-rate mortgage was 3.4 (0.7 point) percent for the week ending January 10, up somewhat significantly from 3.34 percent during the week prior. Bankrate conveyed similar findings in its correlating survey, reporting that the average for 30-year fixed-rate mortgages soared to 3.67 percent—its highest level since September 2012. "All the The nation's unemployment rate remained at 7.8 percent in December as payrolls increased 155,000, slightly ahead of consensus forecasts. According to the Bureau of Labor Statistics' (BLS) latest report, economists had anticipated payrolls expanding by 150,000, slightly higher than the 146,000 increase in payrolls originally reported for November, and that the unemployment rate would remain at November's 7.7 percent. For the fourth quarter, payrolls grew 453,000 compared with 505,000 in the third quarter; 200,000 in the second; and 677,000 in the first. The BLS' unemployment survey took on added significance with the announcement by the Federal Reserve that the target fed funds rate would remain at its historic low, 0 to 0.25 percent, at least until unemployment falls below 6.5 percent. January 2 Holiday Season Slows Application Activity Mortgage application activity went into hibernation for the last weeks of 2012, according to data from the Mortgage Bankers Association's (MBA) most recent survey. During the final two weeks of December, applications fell 21.6 percent from levels observed earlier in the month; as expected, the decrease was driven by a substantial decline in refinance applications. The MBA also reported that the Refinance Index fell 23.3 percent off of totals recorded during December's opening weeks, dropping to the lowest level since April 2012. Meanwhile, the seasonally adjusted Purchase Index also plummeted, falling 14.8 percent compared with its midDecember levels.