What’s Ahead For Mortgage Rates This Week – May 23, 2022

What's Ahead For Mortgage Rates This Week - May 23, 2022

Last week’s economic reporting included readings on sales of previously-owned homes, building permits issued, housing starts, and weekly readings on mortgage rates and jobless claims.

 Sales of Previously-Owned Homes Fall in April

The National Association of Realtors® reported 5.61 million sales of previously-owned homes in April;  analysts expected 5.64 million sales as compared to the March reading of 5.75 million sales calculated on a seasonally adjusted annual basis. Home sales generally increase in prime spring and summer home-buying seasons, but high gas prices, rising inflation, and economic uncertainty likely sidelined some prospective home buyers. Affordability is an increasing obstacle for first-time and moderate-income home buyers; the combined impact of rising home prices and mortgage rates has priced some buyers out of the market.

Analysts said that fewer available homes also caused lagging sales, which were 2.40 percent lower month-to-month and 5.99 percent lower year over year. The total inventory of all homes for sale was 10.40 percent lower year-over-year in April.

The Commerce Department reported 1.72 million housing starts in April; The March reading was 1.73 million starts. Rising materials and labor costs continued to challenge home builders and rising home prices discouraged buyers.

Mortgage Rates Fall; Jobless Claims Mixed

After weeks of rising mortgage rates, Freddie Mac reported lower fixed mortgage rates last week. Rates for 30-year fixed-rate mortgages averaged 5.25 percent and were five basis points lower than for the previous week. The average rate for 15-year fixed-rate mortgages also fell by five basis points to 4.43 percent. Rates for 5/1 adjustable-rate mortgages averaged 4.08 percent and were ten basis points higher. Discount points averaged 0.90 percent for fixed-rate mortgages and 0.20 percent for 5/1 adjustable-rate mortgages.

Initial jobless claims rose to 218,000 new claims filed last week as compared to the previous week’s reading of 197,000 new jobless claims filed. Analysts predicted a reading of 200,000 first-time jobless claims filed. Continuing jobless claims fell to 1.32 million claims filed as compared to the prior week’s reading of 1.34 million ongoing claims filed.

What’s Ahead

This week’s scheduled economic reporting includes readings on new and pending home sales, inflation and consumer sentiment. Weekly reports on mortgage rates and jobless claims will also be released.