December 18th to the 22nd

December 18th to the 22nd


Late Morning Review:

Sales of new homes soared in November, driven by solid demand across the nation. The Commerce Department reported that New Home Sales rose 17.5% from October to an annual rate of 733,000 units, a 10-year high. That was the biggest monthly gain since January 1992. Sales also were up nearly a whopping 27% from November 2016.A strong labor market was one of the catalysts that propelled New Home Sales higher. Regionally, sales rose 31% in the West, 14.9% in the South, 9.5% in the Northeast and 6.9% in the Midwest. The median home price rose 1.2%. Inventories remained on the low end with just a 4.6-month supply, where six months is a more normal level.

Inflation remained tame in November and is a big reason that interest rates as well as home loan rates remain low. The Bureau of Economic Analysis reports that the fed's favorite inflation gauge, the Core Personal Consumption Expenditure (PCE), rose 0.1% in November, which was inline with expectations. The Core strips out volatile food and energy. The Core PCE on an annual basis rose 1.5% from 1.4% in October, but remains well below the fed's target range of 2%. Happy Holidays!

New homesales 1711



Late Morning Review: 

Economic growth remained solid in the third quarter of 2017, spurred on by robust business spending that was well above the weak levels experienced at the beginning of the year. The final read on third quarter Gross Domestic Product rose 3.2%, just above the 3.1% from second quarter. However, within the report it showed that consumer spending, which accounts for two-thirds of economic activity, rose 2.2%, down from 3.3% in the second quarter. Gross Domestic Product (GDP) is the monetary value of all the finished goods and services produced within a country's borders in a specific time period. It is considered the broadest measure of economic activity.

Home price gains continue to make the headlines as low mortgage rates, a strong U.S. economy and low inventories of homes for sale continue to drive prices higher. The Federal Housing Finance Agency (FHFA) reports that its October Home Price Index (HPI) rose 0.5% from September. On an annual basis, prices jumped 6.6%. The FHFA monthly HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac.

With the Christmas holiday on Monday, many Americans will travel to their destinations between now and January 1. Motor club AAA says that more than 107.3 million Americans are predicted to travel between December 23 and January 1, which would be a new record and the ninth consecutive year of increased year-end travel. In addition, AAA says about 97.4 million people are expected to travel by car, 6.4 million people will take plane rides and 3.6 million others will travel by train, bus, rails and cruise ships. Just remember, if you travel via automobile, be sure to have an emergency kit that consists of a flashlight with extra batteries, jumper cables, first aid kits, water, nonperishable food items, matches, blankets and warning devices. Your car should also have an ice scraper and a small shovel in case you get stuck in snow.


End of  Day Wrap:

MBS traded in a tight range for most of the session while Stocks flip flopped between modest positive and negative. The surge in November Existing Home Sales weighed on Bond prices in the early going. The Fannie Mae 30-yr 3.5% coupon closed at 102.12, down 22bp and near flimsy support. The House of Representatives votes 224-201 in approval of procedural alterations made by the Senate yesterday (Senate approved revised bill 51-48). The bill is now just about ready for the President's signature.The Dow lost 28.10 points to 24,726.65, the S&P fell by 2.22 points to 2,679.25, while the NASDAQ lost a meager 2.89 points. WTI oil closed at $58.09, +$0.53. Tomorrow's economic data includes GDP/3rd estimate for Q3 2017, Philly Fed and Weekly Initial Jobless Claims.

Mid-Week Rates Effective December 20, 2017 10:30 AM EST

No origination Fee on all posted rates

Conforming loans $424,100 and under

Fixed Rates

30-Year Fixed 4.000% (4.055%APR)

15-Year Fixed 3.500% (3.5947% APR)

For other programs call or email John

 ***Rate Assumptions below today’s Late Morning Review

Late Moring Review:

U.S. Existing Home Sales surged in November due in part to faster economic growth, the record high stock markets and a strong labor market. The National Association of REALTORS® reports that Existing Home Sales surged to an 11-year high in November to an annual rate of 5.81 million units, with three of the four major regions of the country producing gains. This was up 5.6% from October and up 3.8% from November 2016. Total inventories slumped nearly 10% from last year to just a 3.4-month supply, where a normal inventory level is considered a six-month supply. The median price for all types of homes was up 5.8% from November 2016.

Fannie Mae released its Economic & Strategic Research report this week revealing that the U.S. economy is expected to end 2017 on a cheerful note. Fannie Mae reports that consumer demand and investment spending growth are expected to pick up in the current quarter. "The economy appears poised to finish 2017 on a cheerful note as fundamentals increasingly align with strong business and consumer sentiment. Domestic demand is building momentum, job growth is solid and broad-based, and consumer spending looks likely to strengthen,” said Fannie Mae Chief Economist Doug Duncan.

Both the House and the Senate passed the tax bill yesterday and after a procedural vote today in the House, the bill will now go on to President Trump to sign into law. The bill is expected to go into effect immediately with paychecks seeing the changes possibly in February. The Wall Street Journal reports that the Tax Cuts and Jobs Act represents the "biggest advancement for growth and opportunity in recent memory. It provides real relief to middle-income families and realizes policy goals conservatives have sought for decades." 


Coming soon

***Rate Assumptions

Actual payments will vary based on your individual situation and current rates. The above rates are subject to change.

  • Some products may not be available in all states.
  • Jumbo Rates (loans over $453,100) may not be available to first time home buyers.
  • Lending services may not be available in all areas.
  • Some restrictions may apply.
  • Based on the purchase/refinance of a primary residence with no cash out at closing.
  • We assumed (unless otherwise noted) that: closing costs are paid out of pocket; this is your primary residence and is a single family home; debt-to-income ratio is less than 30%; and credit score is over 780; and an escrow account for the payment of taxes and insurance.
  • The lock period for your rate is 30 days.
  • The loan to value (LTV) ratio is 70%. If LTV > 80%, PMI will be added to your monthly mortgage payment for all conventional loans.
  • Rates assume a credit score of at least 780.
  • ARM (adjustable Rate Mortgage) loans are variable rate loans; interest rates and payments may increase after consummation. After the initial fixed-rate period, your interest rate can increase or decrease annually according to the market index. Any change may significantly impact your monthly payment. Since the index in the future is unknown, the First Adjusted Rates displayed are based on the current index plus the margin (fully indexed rate) at time of scenario/disclosure. For conforming and jumbo ARM interest rates, at adjustment your new mortgage rate will be the average of the Interbank Offered rates for one-year, U.S. dollar-denominated deposits in the London Market(LIBOR) as published in the Wall Street Journal, plus a Margin of 2.25% subject to annual and lifetime adjustment caps.
  • Please remember that we don’t have all your information. Therefore, the rate and payment results you see from this calculator may not reflect your actual situation. National Bank of Commerce offers a wide variety of loan options. You may still qualify for a loan even if your situation doesn’t match our assumptions. To get more accurate and personalized results, please call (205) 266-5669 to talk to John Marbury.
  • 30-Year Fixed-Rate Mortgage: The monthly payment on a $200,000 30-year Fixed-Rate Loan at 4.000% and 70% loan-to-value (LTV) is $954.83 with 0 points due at closing. The Annual Percentage Rate (APR) is 4.055%. Payment does not include taxes and insurance premiums. The actual payment amount will be greater. Some state and county maximum loan amount restrictions may apply.
  • 15-Year Fixed-Rate Mortgage: The monthly payment on a $200,000 15-year Fixed-Rate Loan at 3.500% and 70% loan-to-value (LTV) is $1429.77 with 0 points due at closing. The Annual Percentage Rate (APR) is 3.594%. Payment does not include taxes and insurance premiums. The actual payment amount will be greater. Some state and county maximum loan amount restrictions may apply




End of Day Wrap;

Bond prices retreated again today extending their losses from yesterday which lifted the 10-yr yield to its highest close since late March. The Fannie Mae 30-yr 3.5% coupon closed at 102.31, -34bp trading as high as 102.62 and as low as 102.28 in a rocky session. Stocks ended lower as investors paused after the House passed its tax bill and as lower tech shares sent a chill over the broader market. The Dow lost 37.45 points to 24,754.75, the S&P 500 fell by 8.69 points to 2,681.47, while the NASDAQ was lower by 30.90 points ending at 6,963.85. WTI oil settled at $57.46/barrel, +$0.30. 10-yr T Note yield rose to 2.45%. November Existing Home Sales will be released tomorrow.

Late Morining Review:

U.S. Stocks are slightly lower this morning and taking a breather from their current bullish tone. The Dow Jones Industrial Average has gained a record 5,000 points in 2017, the most ever in a year while hitting fresh record highs 70 times, surpassing the 69 record highs logged in 1995. The index is up nearly 40% since the election and up 25% this year. The gains have been fueled by a marked improvement in consumer confidence and business sentiment, tax reform hope, an improving labor market and economy, along with solid corporate earnings.

In housing news, November Housing Starts were up 3.1% from October to an annual rate of 1.297 million units versus the 1.259 million expected while October was revised to 1.259 million from 1.290 million. November Building Permits, a sign of future construction, fell 1.4% from October to an annual rate of 1.298 million units versus 1.280 million expected and revised to 1.316 million from 1.297 million. The housing market continues to produce gains fueled by a strong labor market and low mortgage rates.

The National Association of REALTORS® (NAR) reports that homebuyer optimism slightly declined in the third quarter from the second quarter of this year. The NAR's survey found that 60% of renters believed that now was a good time to buy a house, down from 62% in the second quarter though up from 57% a year ago. “The trifecta of faster economic expansion, robust hiring and low mortgage rates should be generating a surge in optimism and home sales as 2017 winds down. Sadly, this is not the case.” said NAR Chief Economist Lawrence Yun. 


End of Day Wrap:

MBS began the week lower, pressured by the continued rise in Stocks where the Dow, S&P and NASDAQ all closed at record highs on rising tax reform hope. The Fannie Mae 30-yr 3.5% coupon closed at 102.66, -12bp. The Dow jumped 140.46 points to 24,792.20, the S&P 500 gained 14.35 points to 2,690.16, while the NASDAQ saw a 58.17 gain to end the day at 6,994.75. WTI oil settled at $57.16/barrel, near unchanged. 10-yr yield 2.39% from Friday's close of 2.35%. Tomorrow's economic data includes Housing Starts and Building Permits.


Late Morning Review:

The housing market continues to improve as home builders report strong optimism as the year comes to a close. The National Association of Home Builders Housing Market Index jumped to its highest level in 18 years, up 5 points to 74 and above the 70 expected. Builder confidence has improved in 2017 on hopes of an improved regulatory environment for firms in the residential construction sector. The NAHB said that home buyer traffic and current sales conditions both increased in December. The NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six month.

U.S. Stocks continue to rise on increasing hopes that tax reform will get done before the end of the year. The Dow Jones Industrial Average hit a record high of 24,876.07 today and has soared 5,000 points in a year for the first time ever. The closely watched index is up 25% in 2017 and has increased a whopping 39% since the presidential election in November of 2016. The investing community is usually bullish on the Stock market at the end of the year, but the frothy gains of 2017 may not materialize in 2018.




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