Home Builder Confidence surged in December, Mortgage Rates continue to rise this week, First Time Unemployment low
December 15, 2016
Home builder confidence surged in December after the election in early November. The National Association of Home Builders reported that its Housing Market Index hit 70 this month, above the 63 expected and up from 63 in November. It was the highest level since July 2005. “This notable rise in builder sentiment is largely attributable to a post-election bounce, as builders are hopeful that President-elect Trump will follow through on his pledge to cut burdensome regulations that are harming small businesses and housing affordability,” said NAHB Chairman Ed Brady, a home builder and developer from Bloomington, Ill.
Mortgage rates continued to rise this week after the Federal Reserve announced that inflation has pushed higher, the economy is improving and interest rates will continue to rise. The news caused Bond prices to fall and Bond yields to push higher. Freddie Mac reported on Thursday that the 30-year fixed conventional mortgage rate increased to 4.16% from 4.13% with 0.5 in points. Points are fees paid to a lender equal to 1% of the loan amount. Mortgage rates are at the highest levels in more than two years.
Americans filing for first time unemployment benefits continue to hover near multi-decade lows and as the sector has improved dramatically since the end of the Great Recession back in mid-2009. The Labor Department reported that Weekly Initial Jobless Claims fell by 4,000 to 254,000 in the week ended December 3. Claims have now remained below the 300,000 mark for 93 straight weeks, which is normally associated with a robust job market. First-time unemployment benefits hit a 43-year low in mid-November of 233,000.