Napa Mortgage News

Election Eve and the Affects on the Mortgage Market

February 13th, 2017 8:50 PM by Dale DiGennaro

How will housing be affected?

Dear Gena,

With tomorrow being the "day of truth" in the political arena, and the start of a new presidential era...the big question still remains unanswered!

"Will housing fare better under Trump or Clinton?"

Would it be better to continue under status quo via the democrats and hopefully not rock the boat too much or to shake it up a bit under republican reign!?!

For an election supposedly based on the economy, housing has been somewhat absent from the rhetoric.

According to CNBC....
In order to gauge which candidate would favor the U.S. housing market, one has to look at their wider economic policies and see how they would trickle down to housing.
"What we've really gotten is more directional conversation: One party talking about affordable housing, the other party talking about deregulating a financial market that seems to have largely seized up," said Rick Sharga, executive vice president of Ten-X, an online real estate marketplace for investors. "It would have been nice to see a more holistic view that talks about issues."

For a quick look at what each candidate stands for in housing...click this link for a short video overview.

All in all mortgage applications for both purchases and refinances are down a bit according to the Bankers Association as rates have been creeping up.

Although the Federal Reserve did not raise interest rates Wednesday, they are expected to do so in December and again before the all-important spring housing season.
With home-price gains accelerating again now, that could be a double whammy to sales. The home ownership rate did bounce higher in the latest quarter, but analysts expect it will fall further before bottoming out.

If you have questions on your particular situation...please don't hesitate to call, email or visit our website! We are here to help!

VISIT OUR WEBSITE

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THINKING OF SELLING OR EVEN DOING A REFINANCE...
Our "Home Price Index" will take into consideration your original purchase price & date of home purchase to determine...

according to the appreciation rate for the region you live in...whether it is a good time for you to refinance now or....if you are getting ready to list your home...what a reasonable value for your area would be. You can also sign up to receive a quarterly report of your homes value based on the up to date analysis of your region.

Just a couple of ways that Custom Lending keeps you informed of our changing market place so you can make the best financial decisions for you and your family!

Three Central Bank

meetings...

Over the past week, the meeting of the Bank of England and news related to the U.S. election were the main influences on mortgage rates. The U.S. economic data had little impact. The net result was that mortgage rates ended the week a little lower.

Three major central banks had meetings over the past week, and none of them made any policy changes. In the case of the U.S. Fed and the Bank of Japan, this was the expected outcome. However, investors were disappointed that the Bank of England (BOE) held rates steady and downplayed the likelihood of further rate cuts. Bond purchases from central banks around the world have helped push global bond yields lower in recent years, so this indication from the BOE that there may be less future stimulus than expected caused yields to rise on Thursday, including U.S. mortgage rates.

As expected, the Fed made no change in policy and few

changes in its statement. The statement suggested that

the economy is closer to the threshold required to
increase the federal funds rate.

Fed officials

also expressed more confidence that

inflation will rise to its target level of 2.0%

"over the medium term."

The economy added 161K jobs in October, a little below the consensus of 175K. However, upward revisions added 44K jobs to the results for prior months. Investors focused more on wage growth, which rose more than expected. Average hourly earnings were 2.8% higher than a year ago, which was the largest annual increase since June 2009.

Over the past week, there were many news stories about the two candidates in the U.S. election, and some of these stories had a noticeable effect on mortgage rates. Generally, news which favors a Trump victory has been positive for bonds and negative for stocks. News which favors a Clinton victory has caused the opposite reaction.

Looking ahead, the U.S. election likely will continue to influence mortgage rates. In addition, there will be Treasury auctions on Tuesday, Wednesday, and Thursday. The economic calendar will be very light. The JOLTS report, which measures job openings and labor turnover rates, will be released on Tuesday. Consumer Sentiment will come out on Friday. While the stock market will be open, mortgage markets will be closed on Friday in observance of Veterans Day.

We spent last week recharging our batteries in Cabo San Lucas! You can't beat the beautiful sunsets, gorgeous sandy beaches, glamorous pools, great food, boat trips, making new friends & let me not forget to mention the happy hours!!

Only a short plane ride from CA.....I highly recommend it!

"Thank you for always trusting in us to do the best for you and your family and please feel free to call me anytime with your questions. I will be happy to share with you whatever information you may need!"