Blog posted On July 08, 2019
Mortgage rates are still hovering around year-long lows, following dovish remarks by the Federal Open Market Committee at their June meeting. This week, the only significant housing report will be the Mortgage Bankers Association (MBA) weekly mortgage application survey. Other market-moving reports include consumer credit and the Labor Department’s Job Openings and Labor Turnover Survey (JOLTS).
Consumer credit counts total outstanding consumer debt including revolving credit like monthly credit card bills and nonrevolving credit like student loans and auto loans. In April, consumer credit increased by $17.5 billion, the most in five months. Non-revolving credit increased by 4.2% and revolving credit increased by 7.9%, suggesting consumers are more actively spending.
The Job Openings and Labor Turnover Survey (JOLTS) tracks job openings, hiring, and voluntary quits. Job openings fell slightly to a level of 7.45 million. Hiring hit a record high in April, hitting 5.9 million.
The weekly mortgage application survey returned mixed results for the week ending 6/28. New purchase application submissions increased 1.0% and refinance application submissions decreased 1.0% for a composite decrease of 0.1%. Mortgage rates are likely to stay low for the rest of the year, triggering new purchase and refinance mortgage activity.
Strong consumer spending and a strong labor market typically translate to economic growth. The housing market is also expecting a gainful second half of the year with lower mortgage rates and a slowdown in home price appreciation.