Tuesday, May 29, 2007

What Are Interest Rates Going To Do? 5/28/07

You like me are asked this question often. "What Do You Think Interest Rates Are Going To Do?" You know now here is a customer focused report for Mortgage Market Direction:

Week of: Monday, May 28, 2007

Presently Market Conditions Are:
The Commerce Department reported on Thursday that sales of new U.S. homes unexpectedly jumped 16 percent in April. This jump was the biggest increase since a 16.4 percent surge in April 1993. Sales were boosted by a decrease in prices. In addition, the inventory of unsold new homes fell by 1.5 percent representing a 6.5 month supply which is a decrease from the 8.1 months supply reported in March.

My Expectations Are:
Though home prices are showing a decline, this may be the needed formula for the housing market to turn things around. Economist Robert Brusca of FAO Economics said, "If we look at trends in average new home prices around the time of the last recession, we see that builder capitulation on prices was the catalyst for ending the weakness in the sector." He went on to say, "The low prices jump start demand and get some inventory off homebuilder's hands giving the market a push."

As Your Trusted Advisor For Life My Guidance For You Is:
The U.S. economy is definitely showing signs of strengthening. Orders for durable goods are on the rise, the four- week average of initial jobless claims has dropped, and inflation is moderating. With mortgage rates continuing to be at historical lows and builders offering phenomenal incentives to move inventory, now is an ultimate time to be in the home-buying market. Capitalize on this exceptional season by seeking the assistance of a qualified professional.

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