New Year, Great Mortgage Rates
As a new year dawns, we already have great news to report: Mortgage rates are at historic lows. The news on the economic front may continue to be dismal, but this is actually great news for homebuyers and homeowners looking to refinance.
The big financial headline for the first business day of the year was the release of the ISM Manufacturing index, a key economic indicator.
Numbers released today showed that the performance of manufacturing activity fell even more than expected in December. In fact, the index fell from 36.2 points in November to 32.4, its lowest level since 1980.
So what is the ISM index?
ISM stands for the Institute for Supply Management, and these numbers are released on the first business day of the month, with data from the prior month. It takes into consideration new orders, employment, inventories, production and five other indicators. And number less than 50 indicates contraction.
How important is the index?
Very. This news nearly always moves the markets. It is considered the best single snapshot for the condition of the factory sector.
What does this mean for mortgages?
This bad news for the economy translates into great news for mortgage rates, which are at their lowest in years. If the economy is slow, rates are low to encourage you to participate in the economy. If you are looking to buy or refinance, the market is on your side. Locking in these low rates today means you can cash in on this historic point in our economy’s transition. What are you waiting for?
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