Celebrate July 4 with these refreshing Red, White and Blue Ice Pops from the Food Network. Yields 6.

Place six 3-to-4-ounce ice pop molds in the freezer for 30 minutes. Combine 2 cups strawberries (hulled and roughly chopped) and 1 tablespoon each of coconut cream, and honey in a blender and puree until smooth. Pour into a liquid measuring cup and set aside. Rinse the blender.

Combine 1/2 cup unsweetened coconut milk and 1 tablespoon each of coconut cream and lime juice in the blender and puree until smooth. Evenly divide the strawberry puree between the frozen pop molds. Layer the coconut milk mixture over the strawberry puree. Freeze for 30 minutes. Rinse the blender.

Combine 2 cups blueberries and 1 tablespoon each of coconut cream, honey and lime juice in the blender and puree until smooth. Remove frozen pop molds from freezer and add the blueberry puree. Insert the pop mold stick and freeze until set, at least 4 hours or overnight. Let sit at room temperature for 5 minutes before unmolding and serving.

Initial Jobless Claims fell by 6,000 in the latest week, with 233,000 people filing new unemployment claims. There were also 1.839 million people still receiving benefits after filing their initial claim, as Continuing Claims increased by 18,000.

What’s the bottom line? Initial Jobless Claims followed three straight weeks of increases with a modest decline of 6,000. Continuing Claims are also still trending near some of the hottest levels we’ve seen in recent years, suggesting that the pace of hiring has slowed. The Fed will be closely watching for any rising trends in unemployment claims as they weigh monetary policy and the timing for rate cuts, given their dual mandate and price stability and maximum employment.

The U.S. economy grew more slowly than previously thought during the first quarter, per the Bureau of Economic Analysis, as their final reading of Gross Domestic Product (GDP) for that period showed 1.4% growth. While this was above the 1.3% pace in the second estimate, it is ultimately lower than the 1.6% pace in the first estimate. This is well below the 3.4% growth seen in the fourth quarter of last year.

What’s the bottom line? GDP functions as a scorecard for the country’s economic health, so signs of a slowdown are a concern. The deceleration in GDP in the first quarter of 2024 can be attributed to declines in consumer spending, exports, and state and local government spending

The Case-Shiller Home Price Index, which is considered the “gold standard” for appreciation, showed home prices nationwide rose 0.3% from March to April after seasonal adjustment. Home values in April were also 6.3% higher than a year earlier, following a 6.5% gain in March.

The Federal Housing Finance Agency’s (FHFA) House Price Index also reported a 0.2% jump in home prices from March to April, with prices 6.3% higher than the previous year. Note that FHFA does not include cash buyers or jumbo loans, and these factors account for some of the differences in the two reports.

What’s the bottom line? “For the second consecutive month, we’ve seen our National Index jump at least 1% over its previous all-time high,” confirmed S&P DJI’s Head of Commodities, Brian D. Luke.

These indexes show that homeownership remains a fantastic opportunity for families to create wealth through appreciation gains.

Pending Home Sales fell 2.1% from April to May per the National Association of REALTORS® (NAR), coming in well below estimates of a 2.5% rise, following a 7.5% decline seen from March to April. Sales were also 6.6% lower than they were a year earlier. This report measures signed contracts on existing homes, making it an important forward-looking indicator for closings on these homes as measured in the Existing Home Sales report.

What’s the bottom line? The Pending Home Sales index took another turn lower in April after a significant drop in March, with NAR’s Chief Economist, Lawrence Yun, explaining, “the first half of the year did not meet expectations regarding home sales but exceeded expectations related to home prices. In the second half of 2024, look for moderately lower mortgage rates, higher home sales and stabilizing home prices.”

New Home Sales, which measure signed contracts on new homes, fell 11.3% from April to May, significantly missing forecasts that were expecting a rise. Signed contracts were also 16.5% lower than they were in May of last year.

What’s the bottom line? Despite the pullback in sales, demand for new construction remains strong due to the persistent shortage of existing homes for sale. On that note, more “available” supply is needed to meet buyer demand. While there were 481,000 new homes available for sale at the end of May, slightly higher than the 474,000 seen in the previous report, only 99,000 were completed, with the rest either under construction or not even started yet.

Also, the median home price fell only 0.1% from April but this was not due to falling home prices, which continue to rise nationwide per Case-Shiller and other appreciation indexes as noted below. The median home price represents the mid-price of sales, meaning it’s influenced by the mix of sales in any given month. Builders are constructing smaller, more affordable homes to meet buyer demand, and that pushed the median home price slightly lower comparatively.

While May’s Personal Consumption Expenditures (PCE) showed that headline inflation was unchanged from April, the year-over-year reading declined from 2.7% to 2.6%. Core PCE, the Fed’s preferred method which strips out volatile food and energy prices, rose by less than 0.1% monthly. The year-over-year reading declined from 2.8% to 2.6%, an encouraging drop for the Fed’s mandate of stable prices.

What’s the bottom line? The Fed has been working hard to tame inflation, hiking its benchmark Fed Funds Rate (which is the overnight borrowing rate for banks) eleven times between March 2022 and July 2023. These hikes were designed to slow the economy by making borrowing more expensive and lowering the demand for goods, so pricing pressure and inflation would shrink.

The Fed has held rates steady since last September because inflation had been making good progress lower late last year before stalling in the first quarter of this year. While Fed members have emphasized that they do not expect to cut rates until they’re confident that inflation is moving sustainably towards their 2% target (as measured by annual Core PCE), May’s tamer inflation readings are a welcome sign.

Navigating the complexities of mortgage rates can significantly impact the affordability of your home. A lower mortgage rate not only results in manageable monthly payments but also enhances your buying power. Here’s a guide to understanding the various factors that determine mortgage rates and how you can secure a favorable rate from a trustworthy lender.

What Determines Mortgage Rates?

Mortgage rates are influenced by a blend of market conditions and individual financial factors like credit score, type of loan, and location of your home. While you can’t control the economic landscape, you can optimize your personal financial standing to secure better rates. Let’s discuss how these elements play out:

Economic Factors Affecting Mortgage Rates

The broader economy and market conditions play a crucial role in setting the baseline for mortgage rates. These rates often fluctuate in response to changes in economic conditions such as inflation rates, economic growth, and Federal Reserve policies. Understanding these can provide you with a contextual background for rate changes. Reach out to a NOVA Home Loans professional Loan Officer to discuss how these economic factors impact you.

Personal Financial Factors in Determining Your Mortgage

Your personal financial health is paramount in securing a good mortgage rate. Lenders assess:

• Credit Score: A higher credit score reassures lenders of your reliability, often resulting in lower interest rates.
• Down Payment: Higher down payments reduce risk for lenders, thereby potentially lowering your rate.
• Debt-to-Income Ratio (DTI): Lower DTI ratios indicate better financial health, making you a less risky borrower.

Impact of Property Type and Use on Mortgage Rates

The type of property you’re investing in and how you plan to use it also affects your mortgage rate:

• Primary Residences: Typically qualify for the lowest rates as they are considered low risk.
• Investment Properties: Carry higher rates due to the potential variability in rental income.
• Second Homes: These rates are usually higher than those for primary residences due to increased risk.

How Loan Purpose Influences Rates

The reason behind your mortgage application also influences the rate offered:

• Purchase Loans: Generally, have the lowest rates since they are the primary transactions.
• Refinance Loans: Can have varied rates depending on whether it’s a rate-and-term refinance or a cash-out refinance.

Loan Programs and Their Rates

Different loan programs come with varying rates based on their risk assessment and market position:

• Conventional Loans: Often feature competitive rates for those with strong credit.
• Government-Backed Loans (FHA, VA, USDA): These programs typically offer more favorable rates to help promote homeownership among specific groups.
• Jumbo and Non-QM Loans: Due to their larger loan amounts or non-traditional qualification criteria, these loans usually carry higher interest rates.

Questions on what the best loan for your situation is, start here for some common situations.

Enhancing Your Mortgage Readiness

Improving your credit score, saving for a substantial down payment, and understanding the type of loan that best suits your needs are crucial steps towards obtaining an attractive mortgage rate.

Are you preparing to apply for a mortgage and have questions about how you can secure the best possible rate? Leave a comment below, or contact us directly for personalized advice. Don’t forget to use our online mortgage calculator to see how different rates could affect your monthly payments.

If you are ready, reach out to a NOVA Home Loans professional Loan Officer to discuss your specific situation.

Mortgage Bonds and the 10-year Treasury ended the week mostly unchanged as they have been the past week, and continue to trade sideways in wide ranges between support and resistance.

Mortgage-Backed Securities are between a tough overhead ceiling of resistance at 100.872 and a triple floor of support at the 100.427 Fibonacci level and 100 and 25-day Moving Averages.

The 10-year is also in a very wide range between support at 4.18% and overhead resistance at the 100 and 200-day Moving Averages.

We must remain on guard as MBS and Yields are susceptible to big price swings within these wide ranges. We will likely remain rangebound until some of the important economic data next week, highlighted by the Fed’s favorite measure of inflation, PCE (Personal Consumption Expenditures), which we think could come in lighter than estimates – More on that next week.

More housing news is ahead, starting Tuesday with appreciation data for April from Case-Shiller and the Federal Housing Finance Agency. May’s New and Pending Home Sales follow on Wednesday and Thursday, respectively.

Also on Thursday, look for the final reading on first quarter GDP and the latest Jobless Claims. Friday brings a critical inflation update via the Fed’s favored measure, Personal Consumption Expenditures.

June 26 is National Chocolate Pudding Day. This recipe courtesy of Taste of Home adds peanut butter for an extra special treat. Yields 8 servings.

In a heavy saucepan, combine 1 cup sugar, 1/2 cup baking cocoa, 1/4 cup cornstarch and 1/2 teaspoon salt. Gradually add 4 cups whole milk. Bring to a boil over medium heat; boil and stir for 2 minutes.

Remove from heat. Stir in 2 tablespoons butter, 2 tablespoons peanut butter and 2 teaspoons vanilla extract. Spoon into individual serving dishes and chill until serving. Garnish with whipped cream and chocolate shavings.

Initial Jobless Claims fell by 5,000 in the latest week as 238,000 people filed for unemployment benefits for the first time. Continuing Claims rose 15,000, with 1.83 million people still receiving benefits after filing their initial claim.

What’s the bottom line? While Initial Jobless Claims fell last week, they remain at elevated levels, with the latest reading the highest number of first-time filers in 10 months. Continuing Claims are also still trending near some of the hottest levels we’ve seen in recent years, suggesting that the pace of hiring has slowed. The Fed will be closely watching for any rising trends in unemployment claims as they weigh monetary policy and the timing for rate cuts, given their dual mandate and price stability and maximum employment.

There are signs that consumers are slowing their spending, as Retail Sales were only 0.1% higher from April to May. Sales in April were also revised downward from the originally reported flat reading to a 0.2% loss when compared to March.

What’s the bottom line? The pause in spending last month was a miss on estimates, as forecasters had predicted a 0.1% gain. The Fed will be closely watching future Retail Sales reports, as the strength of our economy will impact their monetary policy decisions this year.

Housing Starts fell 5.5% from April to May, coming in well below what economists had forecasted. Starts for single-family homes, which make up the bulk of homebuilding and are the most crucial due to buyer demand, were also lower at a 5.2% decline. There was a similar trend in future construction, with Building Permits moving lower despite much needed supply.

What’s the bottom line? Softer than expected construction activity this spring could limit much needed supply down the road. This bodes well for appreciation and shows that opportunities remain to build wealth through homeownership.

Confidence among home builders remains below the key breakeven threshold of 50, per the National Association of Home Builders (NAHB), as their Housing Market Index dropped 2 points to 43 in June. Any score over 50 on this index, which runs from 0 to 100, signals that more builders view conditions as good than poor.

Among the three index components, current and future sales expectations both entered contraction territory. The gauge judging buyer traffic also declined, remaining in contraction.

What’s the bottom line? NAHB’s Chair, Caril Harris, explained, “Persistently high mortgage rates are keeping many prospective buyers on the sidelines. Home builders are also dealing with higher rates for construction and development loans, chronic labor shortages and a dearth of buildable lots.”