Florida Mortgage Rate Forecast – July 27, 2010

by Florida's #1 Mortgage Planner on July 27, 2010

Locking Stance:  CAUTIOUSLY FLOATING    Mortgage Bonds:  0bp

We had a little bit of a “scare” this morning as mortgage backed securities dropped out of the starting gates this morning, but have since recovered resulting us not needing to change our stance, at least not yet.  MBS prices do tend to trade opposite of stocks and with stocks projected to open higher, MBS prices were on the descent, but that has changed and MBS prices have regained all of their lost ground at this point.

Not a significant factor, but weekly store sales reports showed declines.  Looking at the housing market, the Case-Shiller Housing Price Index (HPI) was released and showed strength.  The 10-city Composite was up a seasonally adjusted 0.5% (up 1.2% unadjusted).  That brings the unadjusted year/year rate to 5.4%.  This news was helping to keep stocks on the positive.  However, just as we expected, Consumer Confidence was released and was below expectations.  Consumer Confidence was reported at 50.4%, below the expected 51.0%, but last report was revised higher to 54.3 from 52.9.  The report was mixed overall with the concerns still centered on jobs and income expectations, but the planned purchases of appliances, cars, and other “big ticket items” rose, albeit very slightly.  This afternoon will see the 2-year T-Note auction which any surprise could hurt MBS prices and continued strength could give them a boost. 

What does this mean for Florida Mortgage Rates?  Mortgage rates continue to hold steady and will likely continue to do so, at least until this afternoon.  Overall, the outlook continues to look good, though concerns remain, requiring a very cautious eye and an “itchy trigger finger” on the lock button.

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