Recent market news has been both positive and negative. Last week the Labor Department reported that the Weekly Initial Jobless Claims dropped 35,000 in the past week to 353,000, a number much lower than expected. Additionally, Durable Order rose by 1.6%, much higher than expected, and Consumer Sentiment increased for the month of July. Finally, Q2 2012 Gross Domestic Product (GDP) grew by 1.5% which is just above expectations.
On the other hand, New Homes Sales fell by 8.4% in June while foreclosure activity has picked up in the first half of 2012. This news has many wondering if the Fed will act with an additional stimulus in the form of another round of Quantitative Easing, or QE3 – this is a move that would likely be done should the job market not pick up. Should a QE3 announcement be made, Bonds would likely suffer, and as home loan rates are tied to Mortgage Bonds, home loan rates would suffer as well.
The important thing to take away from the recent news is that now continues to be a perfect time to purchase a new home or refinance a home as home loan rates remain near historic lows.
Many reports will be released in the coming week which will point to the likely direction of the market. Among the reports, the ones to watch include:
- Case/Shiller Home Price Index
- Initial Jobless Claims report
- Unemployment Rate
If you are in the market to purchase a new home, today’s market environment is very promising and offers many opportunities. I would be glad to help you.