It was a quiet week for mortgage markets with little market moving news. The economic data that was released over the past week was slightly weaker than expected, and mortgage rates moved a little lower.
This week’s Existing Home Sales data for March showed a small decline from February, partly due to increasing mortgage rates in January and February. Compared to March 2012, however, the results show how much things have improved. Existing Home Sales are 10% higher than one year ago, home prices have appreciated over the past year, and homes for sale are being absorbed more quickly. The results for March New Home Sales showed similar improvement from March 2012.
After climbing from the beginning of the year through early March, mortgage rates have fallen back to the lowest levels of 2013. The reasons for the decline include slower global economic growth, low inflation, and increased Japanese central bank bond purchases. Lower mortgage rates increase the affordability levels for homes, which bodes well for home sales in coming months.
Looking ahead, the results for first quarter US GDP, the broadest measure of economic growth, will be released on Friday. The consensus forecast is for an increase of 2.8%. The first few days of May will be packed with major market moving economic events. There will be a Fed meeting on May 1, a European Central Bank (ECB) meeting on May 2, and the Employment Report on May 3.