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2015-04-24 12:21:38
Existing Home sales increase

  The News Stand  

Mixed economic data released this week had offsetting effects on mortgage rates. Positive housing data pushed rates a little higher, while weakness in the details of the March Durable Orders report helped rates reverse some of the increase. For the week, mortgage rates ended just a little higher.



The housing data released this week was mixed, but it was mostly positive. March Existing Home Sales, which account for roughly 90% of the residential housing market, increased 6% from February to the highest level in eighteen months. 



The inventory of homes for sale rose 5% from February, but the current 4.6-month supply is still far below normal. A 6.0-month supply is considered to be a healthy balance between buyers and sellers. This low level of homes for sale has helped push prices higher and has held back an even faster pace of sales activity.


In contrast to the strong figures for existing home sales, March New Home Sales (seasonally adjusted) showed a decline of 11% from the seven-year high seen in February. This figure should be kept in perspective, however. First, this data is extremely volatile month to month. Second, new home sales still were 19% higher than a year ago. Finally, looking at the data before it is seasonally adjusted shows that the actual number of new home sales in March tied with February as the most units sold in any month going back to 2008.


The big story next week will be Wednesday's Fed meeting. Investors will be looking for hints about the timing of the first federal funds rate hike. Earlier that day, the first reading for first quarter Gross Domestic Product (GDP), the broadest measure of economic activity, will be released. The consensus is for growth of only 1.1% during the first quarter. The Core PCE price index, the Fed's preferred inflation indicator, will come out on Thursday. ISM Manufacturing, Pending Home Sales, and Personal Income will round out a busy week. In addition, there will be Treasury auctions on Monday, Tuesday, and Wednesday.

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2015-04-24 12:21:38
Existing Home sales increase

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