Home appreciation numbers are in this morning showing a 1% increase in value from last month and 6.5% from last year! This is amazing news for current owners who experienced that large equity jump. But will the trend continue? A lot of people in the media have had to continue to revises their stance on the housing market as it blows past expectations. Many are now saying that we will see a slow down later this Fall. Well, as the market continues to open and many signs pointing toward a large housing shortage, you can defiantly argue that it will last longer.
We also received numbers for purchases and refinances this month. Refinance are up 86% from last year while purchases are up 26%. There are a lot of things driving this but this is largely driven by interest rates being down about 1% from last year.
Mortgage backed securities are slightly down this morning as their trading channel continues to shrink. As this channel gets smaller, they will be forced to break out one way or another. It is more likely that they will breakout to the upside and we see pricing improve; however, this is not guaranteed. You may be able to catch these gains by floating and watching the market closely but the safe play is to lock as rates still hover near all time lows.