Mortgage Trends This Week: Aug. 2


The Federal Reserve’s Beige Book is out, and it’s showing a spate of good news for the economy, including one often overlooked indicator of consumer confidence and the U.S. housing market.

The Beige Book, released by the Federal Reserve of St. Louis on July 29, shows that the U.S. economy is coming together in some parts of the country but unraveling somewhat in other parts of the country (particularly in Atlanta and Chicago).

Overall, manufacturing and service sectors are holding their ground (albeit shakily), but it’s the tourism and travel sector that may tell the story about the housing market going forward. According to the Beige Book, tourism activity has increased in the U.S. across the board, with some weakness along the Gulf of Mexico after the BP oil spill.

"Tourism activity increased in the San Francisco, New York, Minneapolis, Richmond, Kansas City and Atlanta Districts," the Beige Book says. "Atlanta reported that leisure travel decreased in the Gulf Coast, but some of the lost tourist traffic was offset by the presence of cleanup crews, oil company workers and the National Guard.”

Tourism is a key benchmark of U.S. consumer confidence. With U.S. home values in free fall since 2008, consumers have had a Vulcan death grip on their wallets and pocketbooks.

But if the Beige Book is spot on, then we may be seeing a reversal of fortune for the housing market, as Americans feel slightly more comfortable about spending money on things like flights to San Francisco or golf trips to Myrtle Beach.

Here’s the thinking on tourism and housing. If consumer sentiment has finally hit bottom, and Americans are hitting the road again in greater numbers, that should help propel the economy forward, and maybe even trigger more home sales that would reduce bloated inventories and stabilize the U.S. housing market.

A stronger economy would also, of course, curb the trend of lower mortgage rates that millions of Americans have used to lock in great deals on new homes this year and last. But that’s a trade-off American homeowners would take if it meant their home values were heading northward again.

So if you’re standing in a long airport line this month, or are bemoaning the crowds at casinos and beaches, don’t fret. It means the economy — even despite a weak 2.4% gross domestic product number last week — is back on the path to recovery.

For the week that was, mortgage rates still remain low, as calculated by the BankingMyWay Weekly Mortgage Rate Tracker.

Description            This Week        Last Week

One-Year ARM           3.488%        3.863%

Three-Year ARM        4.245%        3.851%

Five-Year ARM           3.57%        3.777%

15-Year Mortgage     4.077%        4.176%

30-Year Mortgage     4.613%        4.77%

But if you’re still in the market for a house, keep your eyes on the prize — rates remain historically low. To get the lowest mortgage rates, visit BankingMyWay’s Mortgage Rate Search. Week-to-week, it’s your best bet for finding the best mortgage rate deal possible.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at

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