Mortgage rates trended upward in the beginning of the week but began falling during the latter half of the week. Home prices surged according to both the FHFA home price index and the Case-Shiller home price index. Consumer confidence jumped to its highest level in a year. Mortgage applications slowed. ADP employment saw its largest increase in six months. Pending home sales fell. Initial jobless claims inched up, but continuing claims dropped. Construction spending slowed. Nonfarm payrolls, private payrolls, and manufacturing payrolls all increased. The unemployment rate improved. The participation rate and average hourly earnings remained relatively unchanged. The average hourly workweek grew slightly longer.
Mortgage Rates Currently Trending
This Week's Potential Volatility
- In January, the FHFA home price index increased by 1% month-over-month. Compared to January 2020, home prices surged 12%. The Mid-Atlantic region saw the largest year-over-year growth, ranging between 8% and 12.6%. The Mountain division followed, with home prices appreciating 7.4% to 14.8%. In New England, prices grew 7.3% to 1.3%
- The 20-city Case-Shiller home price index showed a 0.9% gain from December to January. Year-over-year, prices shot up 11.1%. Phoenix had the highest rate of appreciation, up 15.8% year-over-year. The cities that followed were Seattle and San Diego.
- Consumer confidence soared by almost 20 index points in March. Up from February’s revised level of 90.4, the index jumped to 109.7 – a one-year high.
- For the week ending 3/26, mortgage application submissions dropped a composite 2.2%. Refinance submissions dropped 3% while the purchase index dropped 2%. Compared to last year, the refinance index fell 32% but purchase applications grew by 39%.
- According to the ADP employment report, private-sector businesses had their largest gains in six months. By company size, small businesses added 174,000 jobs, while mid-sized companies and large companies added 188,000 and 155,000 jobs, respectively. By sector, construction added 32,000 jobs and manufacturing payrolls increased by 49,000. The service -producing sector gained 437,000 jobs, with the highest increases in the trade/transportation/utilities sector and professional business services.
- In February, pending home sales fell 10.6%, marking the fifth consecutive month of declines. Compared to February 2020, sales were only down 0.5%.
- For the week ending 3/27, initial jobless claims inched up to 719,000. Continuing claims dropped during the week ending 3/20, falling to 3.79 million. Construction spending fell 0.8% in February. The seasonally adjusted rate of $1.52 trillion was only a slight drop from January’s revised level of $1.529 trillion. Year-over-year, construction spending is up 5.3%. The decline came from both private and public construction, both falling 0.5% and 1.7% respectively.
52 Week Average Mortgage Rates
Economic Calendar Outlook
This week’s important economic reports include:
- Job Openings
- Mortgage Applications
- Consumer Credit
- Initial Jobless Claims
- Continuing Jobless Claims