In this week's economic news, mortgage rates increased to a 4-month high while September existing home sales data came in surprisingly positive.
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Existing home sales astounded in September, up 3.2 percent to an annualized rate of 5.47 million. Another positive note from September’s report was the amount of first-time homebuyers entering the market, who represented a strong 34 percent of the month’s sales. The median price fell 2.4 percent to $234,200, while the year-over-year appreciation rate remained at a respectable plus 5.6 percent.
September housing starts dropped a steep 9.0 percent to an annualized rate of 1.047 million. The decline, though, is entirely attributed to the multi-family sector, which is volatile on a monthly basis. Single-family starts and permits were up a respectable 8.1 and 0.4 percent.
September’s Consumer Price Index increased a strong 0.3 percent, as energy prices (+2.9 percent) and rent (+0.4 percent) surged. Year-over-year, CPI is up 4 tenths to 1.5 percent, which is the highest it’s been since October 2014. Core CPI, which excludes food and energy, was up 0.1 percent in the month leading to a year-over-year rate drop to 2.2 percent.
This week in the economy:
- The 30-year fixed-rate average increased to 3.52 percent, according to Freddie Mac.
- Housing starts and permits fell in August. Starts fell a steep 5.4 percent while permits dropped 0.4 percent.
- The October 10 week of MBA Mortgage Applications showed purchase applications were up 3 percent in the week, erasing the prior week’s decline. Refinance applications continue to slow, down 1 percent following the prior week’s 8 percent drop.
- Initial Jobless Claims inched higher in the October 15 week, up 13,000 to 260,000. The 4-week average, though, is 6,500 lower at 251,750.
- October’s Housing Market Index dipped 2 points after a 6-point surge in September. Homebuilders’ optimism about future sales and current sales continues to hold strength, while traffic continues to lag behind.
- The Bloomberg Consumer Comfort Index fell 0.8 points in the October 16 week, dropping below the 42-point mark where it spent much of the last four weeks.
What’s on economic calendar for the week of October 24, 2016:
- Tuesday – FHFA House Price Index, Consumer Confidence
- Wednesday – MBA Mortgage Applications, New Home Sales
- Thursday – Jobless Claims, Bloomberg Consumer Comfort Index, Pending Home Sales
- Friday – GDP, Consumer Sentiment
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