Recommendation Change: It’s time to start floating those loans! We should be watching mortgage rates in Phoenix drop lower these next 3-7 days. Do not lock in your mortgage rate at application; lower rates may be here next week.
Two big numbers came out today:
Inflation (CPI) was a bit higher than expected; thank higher oil and food prices for that.
Core CPI- That’s the inflation number without the oil and food prices figured in, was lower than expected. This means that prices of goods and services are feeling the pinch of higher oil and food prices. That doesn’t make you feel any better if you drive a car and eat; prices are still higher. It does mean that the higher prices of staple goods could throw us into an economic slowdown.
Housing starts were the lowest they have been in 14 years. This means that builders ain’t building. While this is bad news for the housing market TODAY, it will mean that there will be less homes available for sale tomorrow. Ugly figures sometimes precede rebounds; it just won’t feel good while we’re going through it.
Those figures signal more Fed rate cuts and mortgage bonds love that. Expect to lock into rates below 6% next week for conforming, full-doc loans. Stay nimble! In this economy, news travels like lightning. While I’m reasonably certain that lower rates are on the near-term horizon, that could change quickly.
Keep checking back for more information.