News in end use

Home prices climbed nationally from the end of January 2022 to February 2022 at an annualized rate of 11.3%. In February, home prices across the U.S. rose at a slower pace than in January but continued to appreciate at higher rates compared to the same time last year.

According to Redfin, the Seattle-based, technology-powered real estate brokerage firm, an increasing number of home-sellers are dropping their prices, yet another sign that the early 2022 housing frenzy is starting to ease as mortgage rates rapidly approach 5%.

The MCAI declined by -0.7% to a reading of 125.1 in March. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. The index was benchmarked to 100 in March 2012.

Statistics Canada (StatsCan) reported today (4-8-22) that total employment rose by 73,000 (+0.4%) in March, driven by an increase of 93,000 (+0.6%) in full-time work. The unemployment rate fell -0.2 percentage points to 5.3% in March, which is the lowest level since comparable data became available in 1976.

Freddie Mac has released its Primary Mortgage Market Survey (PMMS) for the week ending April 7, 2022. The PMMS reports that the 30-year fixed-rate mortgage averaged 4.72% with an average 0.8 point, up from last week when it averaged 4.67%. A year ago, at this time, the 30-year FRM averaged 3.13%.

The U.S. Department of Labor is reporting that an additional 166,000 Americans (seasonally adjusted) made their initial filing for unemployment benefits during the week ending on Saturday, April 2, 2022. This is a decrease of 5,000 from the previous week’s revised level.

As the outlook for Canada’s inflation rate continues to worsen, Canadian investors are betting that the Bank of Canada (BoC) will begin hiking its key interest rate in half-percentage-point increments, with the first of rarely used upsize moves possibly coming as soon as this month.

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Application Survey (WMAS), for the week ending April 1, 2022, the Market Composite Index (a measure of mortgage loan application volume) declined -6.3 % on a seasonally adjusted basis from one week earlier.

The current labor shortage across the U.S. is nothing new to the construction industry. During the homebuilding boom in the early 2000s, there was a lack of construction workers. The Great Recession and the resulting housing market collapse, which in turn created the foreclosure crisis, caused that shortage to end.

The U.S. Department of Housing and Urban Development (HUD) is asking for mortgage industry input on a proposed rule change that it offered late last week, which would change repayment provisions for FHA borrowers. The change would allow lenders to recast a borrower’s total unpaid loan for an additional 120 months.