Market Updates

Austin Mortgage Update – Week Ending 2/6/09

February 9, 2009 by Kevin Wilhelm · Leave a Comment

What Did Interest Rates Do This Week?
** according to Freddie Mac **

30-yr Fixed – Higher
This Week: 5.25%
Last Week: 5.10%
1yr Ago: 5.67%

15-yr Fixed – Higher
This Week: 4.92%
Last Week: 4.80%
1yr Ago: 5.15%

5/1 ARM – Relatively Unchanged
This Week: 5.26%
Last Week: 5.27%
1yr Ago: 5.21%

Highlight of This Week’s Major Economic Reports

The hot topic of the week centered on the ongoing debate in the Senate regarding the stimulus package, which may have reached a compromise totaling $780 billion. The final vote in the Senate is expected in the next few days, and it would then go back to the House of Representatives for approval.

One key aspect of the proposed bill is a revision to the home-buyer tax credit. Currently a first-time buyer $7500 tax credit to be paid back over 15 years, the new proposal eliminates the repayment requirement, doubles the amount to $15,000, and would be available to all home-buyers.

On the labor front, the latest figures revealed that another 598,000 jobs were lost in January, sparking the biggest monthly job loss figure since 1974. The unemployment rate now sits at 7.6% — the highest since 1992.

What to Look for Next Week

With the economic calendar lacking any notable headliners, both the stock markets and bond markets will be directed by the results of – and reaction to – the stimulus package. It is expected that a final bill will be voted on by both houses of Congress before the end of the week.

Short-Term Rate Outlook

Stable to Slightly Higher

Stay Informed: What’s in the News

“Texas Economy Still Ahead of Nation’s” from Texas A&M Real Estate Center

The Texas economy is cooling but continues to create jobs. While the U.S. economy lost more than 2.8 million jobs from December 2007 to December 2008, Texas gained 154,600 jobs over the same period.

The state’s seasonally adjusted unemployment rate rose from 4.2 percent in December 2007 to 6 percent in December 2008. By comparison, the U.S. seasonally adjusted unemployment rate rose from 4.9 percent to 7.2 percent during the same period.

“Fed: Banks Still Tightening Loan Standards” from USA Today

U.S. banks were miserly with credit through mid-January, as the economy plunged and loan demand deteriorated, the Federal Reserve said Monday in a quarterly lending survey. Banks continued to impose tight conditions on borrowers, even as the Treasury Department provided about $200 billion in capital infusions under a special $700 billion financial rescue law. Treasury officials have pressed lenders to make loans to good clients to get the economy moving. The Fed has begun buying up to $500 billion in mortgage-backed securities to unfreeze lending.

“Fannie Mae and Freddie Mac prevent the extension of eviction” from Ecommerce Journal

Fannie Mae and Freddie Mac, the largest holders of U.S. mortgages, announced on Friday that they intend to extend the eviction cessation until March. They are also launching a new strategy to offer qualified owner-occupants and tenants’ leases so they can rent the properties on a month-to-month basis after foreclosure at market rates. This is the third extension of eviction suspensions. Both Fannie Mae and Freddie Mac started a program to suspend foreclosures evictions on Nov. 26. Those policies were set to expire on Jan. 9, but they were extended until Friday.