New-home sales drop unexpectedly
Posted March 23, 2012
Mortgage rates and bonds ended the week on a better note thanks to a less than stellar report for new-home sales.
Sales of new homes, which were expected to be up 0.7%, or even higher by some estimates, came in down 1.6% – a huge swing from where economists had expected the number to fall – but even with the decline in percentages, there is a silver lining in this month’s report.
Sales in year-over-year figures from last February are up 11.4%, and the median home price rose by 6.2% in year over year data from last February as well.
A potential Chinese slowdown, coupled with the return of European concerns and increasing oil price news out of Iran, could provide some additional relief for bond yields and mortgage rates in future trading sessions.
Also, any continued negative economic news from here at home will help put the brakes on rising rates. Inflationary concerns must be watched as well, however when we begin to see this much uncertainty within global markets, we must expect some level of bond and rate volatility as well.
Have a great weekend everyone!