Gross domestic product declined for a second quarter, down 0.2% on the heels of Q1’s 0.4% dip, the Commerce Department said. By a common definition, this means that the U.S. has entered into a recession. The National Bureau of Economics, a non-profit that determines when the U.S. is officially in recession, defines it as a “significant decline in economic activity that is spread across the economy and that lasts more than a few months.” Many economists say they don’t believe the economy has fully entered recession, pointing out that falling GDP is only one measure of many. Fed chairman Jerome Powell said the data should be taken with “a grain of salt.” But formal definitions notwithstanding, a majority of Americans…
Rate lock volumes dropped again in May by 4.8% despite interest rate growth slowing, according to Black Knight’s latest Originations Market Report. While conforming 30-year rates rose at the beginning of the month to 5.5%, they cooled by month-end to 5.34%, 7 basis points down from April. Still, lock volumes fell for both rate/term and cash-out refis, down 23.6% and 11.9% respectively. Cash-outs are now down 42.2% from last year. “Ultimately, our OBMMI daily interest rate tracker showed 30-year conforming offerings finishing the month at 5.34%, down 7 basis points from last month. Still, despite this plateau in rates, rate lock volume continued to slide in May, with declines seen across all loan purposes,” said Scott Happ, president of Optimal…
Builder confidence fell eight points in May, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The HMI registered a reading of 69 in May, a significant drop from April. This is the fifth consecutive month of decline and the lowest reading since June 2020. The low reading suggests that the housing market is slowing thanks to affordability challenges. “The housing market is facing growing challenges. Building material costs are up 19% from a year ago, in less than three months mortgage rates have surged to a 12-year high and, based on current affordability conditions, less than 50% of new and existing home sales are affordable for a typical family,” said NAHB Chief Economist Robert…
After weeks of waiting, President Biden announced Monday he is renominating Federal Reserve Chairman Jerome H. Powell to another four-year term. Now analysts are asking what impact another Powell term will mean to mortgage rates and the housing market. The move has been characterized as a return to the status quo in which the Fed chairman is reappointed regardless of their political identity, a tradition former President Trump bucked when he appointed Powell. The Fed chairman question has been on many industry watchers’ minds in the last two weeks. Much was made of Biden’s sit down with Fed Governor Lael Brainard, seen as the most likely candidate if Biden chose to make a change. Brainard has instead been nominated as…
The White House took to Twitter on Thursday to promote the housing-related benefits included in the $1.9 trillion American Rescue Plan. Here’s what they had to say: Across the country, millions of Americans are struggling to keep a roof over their head. Here’s a breakdown of how the American Rescue Plan will help:— The White House (@WhiteHouse) March 18, 2021 The American Rescue Plan provides more than $21.5 billion in emergency rental assistance to help millions of families keep up on their rent and remain in their homes.— The White House (@WhiteHouse) March 18, 2021 The bill includes $10 billion to help homeowners behind on their mortgage and utility payments — helping avoid foreclosures.— The White House (@WhiteHouse) March 18,…
