In a week with very little domestic economic news we see the “Flight To Safety Effect” on mortgages as the markets react to fears based on different news items. When people are trying NOT to loose money elsewhere, they buy the US bond market as a safe haven. When it’s safe to go back out, they sell. Remember Fannie, Freddie and HUD/FHA/VA are all part of this bond market. The effect is a see-saw of interest rates as investors move in and out of the bond market. Late last week the SEC charges against Goldman Sachs scared investors, now it’s calmed down. The potential default by Greece on their debt scared investors and now that is calming down. The net effect on mortgages is that rates remained in a narrow range depending on the ‘fear of the day’.
A couple of good news items, both existing housing and new home sales came in very positive as result of the government incentives for buyers. Yes, that will end this month, but it has had the net effect of cleaning up a LOT of existing housing inventory. Finally, if you look at the numbers for durable goods orders (big ticket items that business buy), you’ll see that after you take out purchases of airplanes and those made by Uncle Sam, business are investing again, and that is more evidence that we continue to recover.
Oklahoma State Bond Money is coming out with a new issue on the 27th with a rate of 5.65% and 3.5% down payment assistance.
This week rates ranged between 5.0 and 5.25%, depending on program, credit and points.