Interest rates remain flat to slightly down from last week, but still above support levels. Not much to report yet, but the trend has been our friend, even if only slightly.
New mortgage applications are down for another week. Interesting, refinance applications actually remained the same while purchase applications lagged. As rates remain flat and in the gap between support and resistance, those on the fence of refinancing are starting to finally move forward. As we mentioned last week, part of a sound refinance decision depends on all debt and interest rates, not just the mortgage rate. Our team will happily run numbers to see in refinancing, possibly into a higher rate, is a sound financial decision.
As new applications continue to decline, the latest lender to announce lay-offs is Ditech who has announced they will be closing one of their call centers with over 400 employees in November 2019. We expect these reductions to staff to continue while some small shops will actually exit the market. It is our fear that these types of lay-offs will lower client satisfaction across the industry. Mountain State Financial Group does not subscribe to this business model and are continuing to bring on new talent.
Nationally, sales prices are still on the rise, but they are rising more slowly in most of the country. In addition, there are fewer homes selling for over asking price and more homes selling at a discount. Although it is very premature to assume that we are transitioning away from a sellers’ market, it is thought that millennials are a big part of this as they simply don’t see the value of purchasing homes at these higher prices. We don’t predict any kind of bubble in the metro area at this time, but we will be watching millennial purchase activity closely.