582 Lynnhaven Parkway, Suite 300 Virginia Beach, VA 23452
In This Issue...
Last Week in Review: Key housing and labor market news was released, but events from overseas dominated the headlines.
Forecast for the Week: Look for important news on inflation, manufacturing, and consumer attitudes and spending—all in the second half of the week.
View: Recharge your job satisfaction with these four easy tips.
Last Week in Review
"It's a small world after all." The economic calendar may have been fairly quiet, but plenty of headlines from overseas led to a volatile week in the markets. Here are the takeaways.Starting at home, research firm CoreLogic reported that home prices, including distressed sales, rose by 7.5 percent on an annualized basis in June. This is down from the 8.3 percent increase recorded in May. Price gains have been easing after the big increases that were recorded in 2013, due to modestly rising inventory and less than expected demand. CoreLogic is forecasting a 5.7 percent increase from June 2014 to June 2015, which is further evidence of a slowdown in gains.
Also of note, Weekly Initial Jobless Claims fell by 14,000 in the latest week to 289,000. Claims are now at eight-year lows as the labor market continues to improve. In addition, the four-week moving average of claims reached the lowest level since February 2006. This news is significant, as jobless claims are a leading indicator of the health of the labor market—and improvement in the labor sector is a key tenet of our continued recovery.
Ongoing tensions between Russia and Ukraine, the fighting in Gaza, U.S. airstrikes in Iraq, and more debt woes in Europe are some of the biggest headlines from the past week. When there is uncertainty like this in the world, we often see "safe haven" trading in the markets. This is where investors move their money out of Stocks and into less risky assets like Bonds—including Mortgage Bonds, the type of Bond on which home loan rates are based. Stocks have gotten clobbered recently but our Bond markets have benefitted—and as Mortgage Bonds improve, so do home loan rates.
The bottom line is that home loan rates remain near some of their best levels of the year and now is a great time to consider a home purchase or refinance. Let me know if I can answer any questions at all for you or your clients.
Forecast for the Week
The second half of the week heats up with several important reports.
On Wednesday, we'll learn key details about consumer spending habits with Retail Sales for July.
Weekly Initial Jobless Claims will be released, as usual, on Thursday. Last week's number hit lows not seen since before the recession.
Friday's packed calendar includes July's Producer Price Index, which measures inflation at the wholesale level. Also look for the Empire State Manufacturing Index and Consumer Sentiment Index for August.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.
When you see these Bond prices moving higher, it means home loan rates are improving—and when they are moving lower, home loan rates are getting worse.
To go one step further—a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.
As you can see in the chart below, geopolitical headlines have helped Mortgage Bonds improve. Home loan rates remain near some of the best levels of the year and I will continue to monitor them closely.
Chart: Fannie Mae 4.0% Mortgage Bond (Friday Aug 08, 2014)
The Mortgage Market Guide View...
4 Tips to Recharge Your Job Satisfaction
With the amount of time people spend working, job satisfaction is an important part of life. If you ever find yourself in a rut, here are four tips that can help.
Keep your eyes on the prize. Measurable goals (like number of homes built or percent increase in revenue) are key to business success. Equally important is translating how goals represent something invaluable (like dreams realized and happy families). Tie measurable goals to the bigger picture and focus on that vision to inspire you.
Set boundaries and expectations. Technology expanded the workday with anytime, anywhere access to email and calls. Clearly, the lines between professional and personal time have blurred—and both sides can suffer from lack of focused attention. So what's the solution? Set specific, appropriate work hours. In email and voicemail messages, let others know your work hours and a realistic timeline of how quickly you'll respond. Condition yourself to not constantly check emails and voicemails when you are off work—or, at the very least, commit to a schedule (e.g., after the kids are in bed or after your favorite TV show).
Schedule a Power Hour. An uninterrupted hour each week will recharge you. Use a Friday Power Hour to organize and prioritize for the next week. Use a midweek Power Hour to catch up on industry reading or write handwritten notes to clients.
Create new challenges. Join an organization to meet new people and gain a fresh perspective. Present a seminar with community education or at a local club to share your expertise. Start a blog and commit to at least one 250-word weekly post.
These four tips can reignite your passion for what you do. As always, please feel free to pass them along to your team, colleagues and clients!
Economic Calendar for the Week of August 11 - August 15
Wed. August 13
Wed. August 13
Retail Sales ex-auto
Thu. August 14
Jobless Claims (Initial)
Fri. August 15
Producer Price Index (PPI)
Fri. August 15
Core Producer Price Index (PPI)
Fri. August 15
Empire State Index
Fri. August 15
Consumer Sentiment Index (UoM)
The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.
As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
If you prefer to send your removal request by mail the address is:
Jim Belote Union Mortgage Group 582 Lynnhaven Parkway, Suite 300 Virginia Beach, VA 23452
Vantage Production, LLC is the copyright owner or licensee of the content and/or information in this email, unless otherwise indicated. Vantage Production, LLC does not grant to you a license to any content, features or materials in this email. You may not distribute, download, or save a copy of any of the content or screens except as otherwise provided in our Terms and Conditions of Membership, for any purpose.