Untitled Document
Inside Lending from Mark P. Moyes
Untitled Document
Mark P. Moyes

Mark P. Moyes
Associate Lending Manager
7730 S Union Park Ave, Ste 200
Midvale, UT 84047
Phone: 801-983-8200
Mobile: 801-999-0886
Fax: 888-835-4067

Veritas Funding, LLC

Inside Lending
For the week of July 24, 2017 – Vol. 15, Issue 29

>> Market Update 

QUOTATION OF THE WEEK... "Success doesn't come to you...you go to it." --Marva Collins, American educator

INFO THAT HITS US WHERE WE LIVE ... The pace had fallen for three months in a row, but in June Housing Starts came roaring back with an 8.3% gain, to post their largest monthly boost of the year. This put them at a 1.215 million unit annual rate. However, we need 1.5 million new units per year to cover population growth and tear downs, so there's still more recovery to come. Starts overall are up 2.1% compared to a year ago, and single-family starts are up 10.3% (multi-families are down). This is a positive sign for the economy, since each single-family home contributes to GDP, on average, around twice what a multi-family unit does.

It was also terrific to see housing completions increase by 5.2% in June, bringing them 8.1% ahead of where they were a year ago. Want to know what the future of home building looks like? Building Permits for new structures shot up 7.4% in June, their largest monthly hike since 2015. The greater interest here is also in single-families, as those permits are up 9.2% versus a year ago. Some experts are now saying 2017 could be the best year for new construction in a decade. No wonder builders continue to feel confident. Yes, the National Association of Home Builders sentiment index did slip in July, but landed at a still very high 64 reading.

BUSINESS TIP OF THE WEEK... Talk more, text less. Success is built on relationships, and the quickest way to build them is by interacting with clients, prospects and partners personally--over the phone and face-to-face.

>> Review of Last Week

ROLLING ALONG... Things keep moving ahead on Wall Street, as investors remain optimistic about the economy, sensing growth-friendly policies will eventually come out of Washington. There's plenty to feel good about right now, with some solid corporate earnings reports, plus indications that monetary policy will remain accommodative (meaning low interest rates) as far as anyone can predict. Both the European Central Bank and the Bank of Japan left interest rates alone last week, and our Fed should do the same on Wednesday. The S&P 500 ended ahead for the third week in a row and the Nasdaq hit a new record high, though the Dow slipped a tick.

Economic data wasn't too shabby either. In addition to the excellent home building reports covered above,
the Conference Board Leading Economic Index (LEI) went up 0.6% in June after a 0.2% gain in May. The New York Empire Manufacturing Index and Philadelphia Fed Index for July showed factory activity in those regions continues to grow, though at a slightly slower pace. Weekly Initial Unemployment Claims stay in the low 200K range and Continuing Unemployment Claims remain below 2 million. Finally, the price of West Texas crude suffered its biggest drop in two weeks, which nudged some investors over to bonds.

The week ended with the Dow down 0.3%, to 21580; the S&P 500 UP 0.5%, to 2473; and the Nasdaq UP 1.2%, to 6388.

The bond market saw Treasuries hit multi-week highs, sending yields and interest rates down. We also had a rally in eurozone government bonds. The 30YR FNMA 4.0% bond we watch finished the week UP .28, to $105.31. After inching ahead two weeks in a row, national average 30-year fixed mortgage rates dropped in Freddie Mac's Primary Mortgage Market Survey for the week ending July 20. This was in part due to "weak inflation data." Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.

DID YOU KNOW?... Google reports that so far this year, search activity for first-time buyer mortgages is at an all-time high: 44% of mortgage searches are for first-time buyer mortgages, up 11% from last year. 

>> This Week’s Forecast

EXISTING HOME SALES OFF, NEW HOMES FLAT, THE FED TREADS WATER... The forecasters say June Existing Home Sales will be off a bit and New Home Sales will come in flat. Not surprising, given the tight inventory of existing homes in many areas, and the fact builders are still scurrying to catch up with demand. No hike is expected in the FOMC Rate Decision. The predicted slower growth in the Employment Cost Index would indicate inflation is tame, which continues to keep the Fed in check.

>> The Week’s Economic Indicator Calendar

Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.

Economic Calendar for the Week of Jul 24 – Jul 28

 Date Time (ET) Release For Consensus Prior Impact
Jul 24
10:00 Existing Home Sales Jun 5.58M
5.62M Moderate
Jul 25
10:00 Consumer Confidence
Jul 116.8
118.9 Moderate
Jul 25
10:00 New Home Sales Jun 610K
610K Moderate
Jul 26
10:30 Crude Inventories 07/22 NA -4.73M Moderate
Jul 26
14:00 FOMC Rate Decision 07/26 1.125% 1.125% HIGH
Jul 27
08:30 Initial Unemployment Claims 07/22 240K 233K Moderate
Jul 27
08:30 Continuing Unemployment Claims 07/15 NA 1.977M Moderate
Jul 27
08:30 Durable Goods Orders Jun 2.9% -1.1% Moderate
Jul 27
08:30 Durable Goods Orders - ex transportation Jun 0.5% 0.1% Moderate
Jul 28
08:30 GDP - Advanced Q2 2.8%
1.4% Moderate
Jul 28
08:30 Employment Cost Index Q2 0.6% 0.8% HIGH
Jul 28
10:00 U. of Michigan Consumer Sentiment - Final Jul 93.1 93.1 Moderate

>> Federal Reserve Watch   

Forecasting Federal Reserve policy changes in coming months... The probability of a rate hike from the Fed is very slim for this week's FOMC meeting and for the next two. But sentiment is rising for a rate rise in December. Note: In the lower chart, a 3% probability of change is a 97% certainty the rate will stay the same.

Current Fed Funds Rate: 1.0%-1.25%

After FOMC meeting on: 0Consensus
Jul 26 1.0%-1.25%
Sep 20 1.0%-1.25%
Nov 1 1.0%-1.25% 

Probability of change from current policy:

After FOMC meeting on: Consensus
Jul 26         3%
Sep 20         8%
Nov 1         9%

Untitled Document

This e-mail is an advertisement for Mark P. Moyes. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Veritas Funding, LLC and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Veritas Funding, LLC. Veritas Funding, LLC NMLS #252108. NMLS # 267431 LIC #5644469

Equal Housing Lender

Forward to a friend :
Required fields are marked *
Your Email Address:*
Recipient Email Address:*