First Time Home Buyers
Mortgage rates on nearly all first time home buyer programs improved last week as a number of influential economic reports came in softer than expected, including:
- Consumer Confidence posted 16% short of expectations
- New Home Sales posted 13% short of expectations
- Initial Jobless Claims were higher than expected
Rates didn’t go as low as they could have for one major reason. Fed Chairman Ben Bernanke explicitly eased some concerns that the monetary policy would get too tight, too quick for the liking of the stock market. In his semi-annual testimony before Congress, Bernanke stated that the Fed Funds Rate would stay low for an extended period of time. Stock traders like the prospects of low rates and Wall Street rallied on Friday afternoon.
Mortgage Rate Predictions for First Time Home Buyers
This week should see any of a few things move rates for first time home buyer programs.
The jobs report hits on Friday and should be the most influential piece of data this week. Expectations are that 30,000 jobs were lost in February. More losses, lower rates. Less jobs lost, higher mortgage rates.
Additionally, the U.S. dollar will swing rates. As the dollar grows stronger, rates go lower. With absolute chaos in Europe right now, rates have been held lower. If the EU can figure out what to do with Greece, rates could tick a bit higher.
This all ties into the “free market” mortgage rates, conforming rates and the FHA rates. Other loans for first time home buyers, such as the state programs, do not change as often.
Right now, rates are incredibly low. We’re still forecasting them to go up eventually, it’s just a matter of when.
If you enjoyed this article, please consider sharing it!
