Market Updates

Austin Mortgage Update – Week Ending 3/13/09

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

30-yr Fixed – Lower
This Week: 5.03%
Last Week: 5.15%
1yr Ago: 6.13%

15-yr Fixed – Lower
This Week: 4.64%
Last Week: 4.72%
1yr Ago: 5.60%

5/1 ARM – Lower
This Week: 4.99%
Last Week: 5.08%
1yr Ago: 5.58%

Highlight of This Week’s Major Economic Reports

The stock market actually managed to pull off a rally this week, thanks in large part to surprising news of profitability from the country’s largest banks. We are hopeful the Fed’s efforts for making money cheaply available to banks is finally making a positive impact on banks’ balance sheets, which in turn is helping to stimulate lending.

Moreover, despite the continued barrage of weak economic data, there is a lot of comfort we can take in that the numbers seem to be less severe of late. Retail Sales, for instance, fell only 0.1% in February. Not bad given the dire state of the automotive industry. Also, weekly unemployment claims – despite remaining at high levels – are at least starting to show some signs of leveling off, since the numbers haven’t worsened in recent weeks.

What to Look for Next Week

It’s time for the Fed’s monthly meeting to discuss monetary policy, and it’s widely expected that there will be no change in short-term rates. We’ll also get another peak at the latest inflation gauges via the Consumer and Producer Price Indexes.

Short-Term Rate Outlook

Stable

Stay Informed: What’s in the News

“Texas Foreclosures Down” from the Associated Press

Texas’ foreclosure filings last month dropped 14.1 percent from a year earlier but increased 7.9 percent from January, according to the latest report from RealtyTrac, a foreclosure-listing firm.

Those numbers compared favorably to the nation’s. RealtyTrack reported that, nationally, nearly 291,000 homes received at least one foreclosure-related notice last month. That is up 30 percent from February 2008 and 6 percent from January.

The news varied throughout the state. For example, Brazos County experienced a slight uptick in foreclosures.
RealtyTrac listed a total of 58 bank-owned properties in the county since late 2006. Of those, 17 were entered over the months of January and February, compared with two properties entered from the same period of 2008.

Meanwhile, farther east, the Jefferson County clerk’s office records show that banks filed 67 notices in January, 97 notices in February and 28 so far in March. That compares with 141, 91 and 66 notices in those respective months last year.

Dr. Jim Gaines, research economist at the Real Estate Center at Texas A&M University, said he believes more people in the area will face foreclosure in the coming months. In Beaumont, some areas may see higher rates than others, and those areas may be subdivisions where creative financing was used to get people into homes that they maybe could not afford.

“HUD May Pull Restrictions on Builders’ Incentives” from Inman News

Federal regulators propose to withdraw a RESPA rule change that would bar homebuilders from offering consumers incentives that require them to use the builders’ affiliated mortgage and title insurance companies. It’s unclear whether the change — which the National Association of Home Builders has gone to court to block — will actually be scrapped, and if so, whether regulators will go back to the drawing board and launch a public process to rewrite it. About all that’s certain is that the Department of Housing and Urban Development is now promising that restrictions on homebuilder incentives originally slated to take effect in January won’t be implemented until mid-summer — if ever.

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