Mortgage rates edged lower early this week due in part to the Middle east tensions. Freddie Mac reports that the 30-year fixed-rate mortgage fell by eight basis points to 3.64% with 0.7 in points and fees. However, rates have inched higher in the past few days. Freddie Mac says that the drop in mortgage rates, combined with the strong labor market, should propel a continued rise in homebuyer demand. Last year this time the rate was 4.45%.
The Federal Reserve reports that the value of all U.S. owner-occupied homes increased to a record $29.2 trillion in Q3 2019 in its Flow of Funds Report. It was a 4.2% increase from a year earlier, the slowest annualized gain since 2012. Americans owned $18.7 trillion of their homes, giving them a 64% equity stake, the report said. In addition, the collective value of U.S. homes is now 21% higher than the bubble peak hit in 2006.
Americans filing for first-time unemployment benefits fell by 9,000 in the latest week to 214,000 and remain at 50-year lows. To put it in perspective, in 1970 the U.S. population was 200 million, today it stands at 327 million. This remains a solid reading and leading indicator for the labor market. The four-week moving average of claims, which irons out seasonal abnormalities, fell by 9,500 to 224,000 last week.
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