MORTGAGE BLOGPosted On October 07, 2016
The mortgage rate has increased slightly since Monday. We are closing out the week with a floating market with some declines to report. Construction spending continues to decline and ADP reports show a lower than expected job increase.
Construction spending – continues a pattern of weakening led by steep declines in public projects. Spending on construction dropped 0.7% in August, contradicting economists’ forecasts of growth. Public Construction projects dropped 2% and Private Projects dropped 0.3%. Overall spending is 0.3% lower than it was one year ago.
ADP’s private sector employment – reported 154,000 jobs were added in September, down from 175,000 in August. This is the smallest increase since April. Most job gains last month took place in the service sector with the addition of 151,000 jobs. Manufacturing suffered however, with a loss of 6,000 jobs in September.
End of Year Forecast – after a quiet summer, analysts across the board are predicting a heated housing market. The CoreLogic HPI (Home Price Index) Forecast suggests that home prices will increase 5.3% from August 2015 to August 2016. Zillow also issued a forecast that prices have gone up 5.1% in the last year and will continue to rise through 2017.
Based on the latest market changes, the Mortgage Bankers Association (MBA) predicts that rates will rise gradually in 2017 but not exceed 5%. We’ll check in with you on Monday, have a great weekend.
Sources: CoreLogic, Home Buying Institute, Market Watch, Market Watch
