The Housing Market is Resilient
The Mortgage Bankers’ Association released their mortgage data showing purchase and refinance application volume across the country.  Purchase application volume increased by about 1% from the same time last year.  Even with slightly higher interest rates and increased home values, home purchases are continuing and their growth and resiliency is evident.  Refinances are down by about 27% from this time last year, but are still in the mix and takes up about 37.6% of the total share of mortgage applications.



What is inflation and how does it affect interest rates?
Inflation is the rise in the pricing of goods and services that erodes the value, or purchasing power, of the consumer’s dollars.  When Inflation occurs, investors tend to lessen their purchases of mortgage backed securities or bonds and of treasuries.  They lessen their investments because their fixed return are forecasted to have less of a return due to inflation of the weakening dollar. In a nutshell, the investment loses its value.   Because of this, demand in these investments drops which then pushes yields higher, ultimately increasing mortgage rates.  A recent inflation monitoring report called the Personal Consumption Expenditures (PCE) was just released and it showed that inflation had ticked up slightly from 1.8% to 2%.  When increasing inflation is reported, interest rates tend to react negatively, so reports like this one need to be monitored at all times.




Fun Facts about the month of July
July is marked as the hottest month in the northern hemisphere.
The birthstone of July is the ruby which represents health, wisdom, wealth and love.
July is a fun month for food items as well because it is National Blueberry, Ice Cream and Hot Dog Month.

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