Mortgage Commentary on Massachusetts Mortgage Rate Trends
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Friday’s bond market has opened in positive territory as stocks show early losses. The Dow is currently down 96 points while the Nasdaq has lost 32 points. The bond market is currently up 23/32, which should improve today’s Massachusetts mortgage rates by approximately .250 – .375 of a discount point.
Yesterday’s 7-year Treasury Note auction nearly followed suit of Wednesday’s 5-year Note sale. Demand in the securities was pretty strong by several measurements we use to gauge investor interest. This allowed bonds and Massachusetts mortgage rates to improve during afternoon hours, but I think most lenders opted to wait until after this morning’s data to reflect those improvements.
August’s Personal Income and Outlays report was posted early this morning. It showed an unexpected decline of 0.1% in personal income, meaning consumers had less money to spend than in July. This is good news for Massachusetts mortgage rates because lower levels of spending mean less economic growth and that makes mortgage securities more attractive to investors. The 0.2% increase in spending matched forecasts, so it has had little impact on this morning’s trading.
The University of Michigan updated their Index of Consumer Sentiment for September late this morning. They announced a reading of 59.4 that exceeded forecasts of 57.5. It also means that consumers were much more optimistic about their own financial situations than many had thought, which is negative news for bonds and Massachusetts mortgage rates. Fortunately though, the stock selling is taking center stage this morning, allowing traders to shrug off this data.
Next week doesn’t bring us many economic reports for the markets to digest, but what is being released is worth watching. It will be a week of quality, not quantity. There is important news Monday with the release of the ISM manufacturing index late morning. It measures manufacturer sentiment, giving us a gauge of manufacturing sector strength. This report is the first we see each month that tracks the preceding month’s activity, so it is watched closely and can affect Massachusetts mortgage rates.
The rest of the week has a couple of relevant reports to Massachusetts mortgage rates, one of which is the almighty monthly Employment report next Friday. Fed Chairman Bernanke will be speaking to a joint congressional committee on current economic conditions and monetary policies Tuesday morning, which should be interesting. Look for more details on next week’s events in Sunday’s weekly preview.
Lock or Float Advice based on Massachusetts Mortgage Rate Trends
If I were considering purchasing or refinancing a home and predicting likely Massachusetts mortgage rates, I would…
Lock if my closing was taking place within 7 days…
Float if my closing was taking place between 8 and 20 days…
Float if my closing was taking place between 21 and 60 days…
Float if my closing was taking place over 60 days from now…
This is only a general opinion of what I would do if I were considering whether to lock or float based on Massachusetts mortgage rate trends. Your individual situation may be different.
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