Blog posted On January 08, 2021
Average mortgage rates touched the current record low for the second time this week. Construction spending rose again for the fifth time over the past six months. Mortgage application submissions decreased over a two-week period. ADP employment fell for the first time in eight months.
Construction spending increased again in November, up 0.9% from the month before. This marked the fifth increase since the economy reopened last May. Over the past year, construction spending has surged 16.2% – with the annual pace over the past six months rising nearly 50%. Home builders are racing to increase housing supply in order to meet the booming home buying demand – a demand that is expected to keep rising as the economy recovers from the pandemic.
Mortgage application submissions decreased for the two weeks ending 1/1. Refinance application submissions dropped by 0.8% while new purchase submissions dropped by 6%, leading to a composite decrease of 4.2%. In comparison to last year, refinance submissions are up by 100%. According to Joel Kan, MBA’s associate vice president of economic and industry forecasting, “The record-low rates for fixed-rate mortgages is good news for borrowers looking to refinance or buy a home, as around 98% of all applications are for fixed-rate loans.”
The ADP employment report revealed a reduction of 123,000 jobs in December, marking the first decline since April. Small businesses lost 13,000 private sector jobs, while large businesses lost 147,000. Medium sized businesses added 37,000 jobs. The job losses were primarily focused in the retail, leisure, and hospitality industries.
Striking the current record low for the second time is a good sign for mortgage rates. As Kan said, the record lows are “good news” for borrowers looking to buy or refinance. By refinancing your mortgage with the current low rates, you could save thousands of dollars over the life of your loan. To learn more, click the apply now button above or contact us today!