Home sales create jobs. The construction and sale of homes generate revenues for the home builder, contract labor, and retailers. After a home is sold, the new homeowner purchases appliances and furniture to make the house a home.
Housing activity impact on the local (and state) economy is substantial, and effects national and global economies as well. The business of housing has a direct bearing on stocks, bonds, and commodities . The Mortgage Bankers' Association of America compiles data on home sales activity. The MBAA purchase applications index tracks trends for home builder stocks, mortgage lenders, home furnishings companies, and applications for home loans. This index is a leading indicator for single-family home sales and housing construction.
Interest Rates for 7/29/2009
Poor economic data and decline in the stock market improves MBS prices and interest rates early this morning. New York Fed President William Dudley spoke on the economy this morning. He sees positive growth for the economy in the second half but the recovery will be slow due to weak income, a reduction in household net worth, and consumers boosting savings.
Conforming Conventional 30Yr Fixed 5.375%
Conforming Conventional 15Yr Fixed 4.750%
Conforming Conventional 5/1 IO ARM 4.375%
FHA 30Yr Fixed 5.375%
* Above Conventional rate quotes are as of 7/29/09 on a Conventional $165,000 loan amount, primary residence at 80% loan to value, with a 720 FICO score. APR includes $1,200 in lender fees and 980 in title charges (title charges may vary). FHA Quote assumes a $125,000 loan amount and a 680 FICO score, and a 96.5% LTV. Documentation of income and assets required. No origination or discount points.