Financing Homes in Lake Tahoe and Truckee since 1992.

Lake Tahoe Mortgage Rate Trends- January 22, 2016

Friday’s bond market has opened in negative territory with stocks showing strong gains during early trading and the more important of today’s two economic releases giving us unfavorable results. The Dow is currently up 225 points while the Nasdaq is up 99 points. The bond market is currently down 15/32 (2.08%), which with some weakness late yesterday should push this morning’s mortgage rates higher by approximately .250 of a discount point.

The National Association of Realtors announced late this morning that home resales jumped 14.7% last month, exceeding forecasts by a pretty wide margin. Part of this increase is being attributed to a correction from November’s soft sales that were blamed on new disclosure rules that delayed closings. Still, because this news points towards a strengthening housing market that makes broader economic growth more likely, we need to consider the data negative for the bond and mortgage markets.

December’s Leading Economic Indicators (LEI) was also posted at 10:00 AM ET today, revealing a 0.2% decline. This was close to the 0.1% decline that was expected, meaning the indicators are predicting slower economic growth over the next several months. Since bonds tend to thrive in weaker economic conditions, we should consider this data good news for mortgage rates. However, it is a minor report that showed a slight variance from forecasts, so its impact on today’s trading has been nearly non-existent.

We have a pretty busy week to look forward to next week with mortgage relevant events taking place four of the five days. There is nothing of importance scheduled for Monday, but the rest of the week brings us some important economic data including the initial GDP reading for last quarter, along with the first FOMC meeting of the year and a couple of Treasury auctions. Look for details on next week’s calendar in Sunday evening’s weekly preview.