HOUSING… the housing market remains on fire, as Existing Home Sales were reported at 6,750,000 – hotter than estimates of 6,550,000. New Home Sales were up 3.5 percent to 1,206,000. This was the strongest report since May, and the third best ever!

OIL… oil prices are finally sliding lower. Concern over oil supplies ahead of the Northern Hemisphere winter lessened somewhat because of a reported rise in US oil inventories. Higher oil prices have been a drag on the economy, so the better than expected oil inventories arrived as welcome news.

THE US DOLLAR… coming into play is a rising US Dollar, triggered by an interest rate hike by China’s Central Bank, the first in nine years. The 0.27 percent rate hike by China was done to slow their sizzling economic growth. The interlocking relationship between oil prices, the value of the US Dollar, and home loan rates can seem complex…but put simply, the Dollar tends to gain strength as oil prices fall. Bond prices tend to weaken when the Dollar rises and oil prices decline, and this causes home loan rates to increase.

So what’s the bottom line? Home loan rates worsened early in the week, but recovered some on Thursday and Friday, and remained little changed overall.

DO YOUR RETIREMENT ACCOUNT BALANCES SCARE YOU…OR ARE YOU A SAVVY SAVER WHO HAS DONE QUITE WELL SO FAR? BE SURE TO READ THIS WEEK’S MORTGAGE MARKET VIEW TO DISCOVER HOW A FEW EASY “TRICKS” COULD PROVIDE YOU WITH A REAL “TREAT” WHEN RETIREMENT ARRIVES.

And just like the infamous Ginsu knives… ”but wait, there’s more!” Also bringing big excitement to the week is Friday's important Jobs Report. Consensus estimates are for 175,000 new jobs, so anything above the 175K mark would indicate some nice employment growth. In turn, this good news could spook Mortgage Bonds and pressure them lower, thereby causing home loan rates to rise.

The news of the week will dictate the course of home loan rates ahead, but given that Mortgage Bonds are at lofty levels not seen since Spring…a cautious stance seems advisable.

Social Security's assets are steadily being drained… this problem is being exacerbated by the declining ratio of people working (paying into the system) to those who are receiving benefits. It appears obvious that individuals will have to rely more on personal savings when it comes time to retire. Although it is never too early to start planning for retirement, individuals are faced with the challenge of thinking about the long term and adequately preparing for it. It is all too easy to get caught up in day-to-day activities, and postpone thinking and planning for retirement. It has been said that most people spend more time and energy planning their summer vacation than they do their retirement.

While it’s never too late – and if you have not done so, the best time to start is now – the earlier you begin to plan for retirement, the better. This is because the more time you have to invest, the more you can harness the tremendous power of compound interest over time.

Yet the major challenge of retirement planning… simply finding the money to put towards it.

It can be difficult to find the money to save for retirement, while dealing with the basic costs of living… food, vehicles, children’s needs, school tuition costs, and unexpected expenses. However, sometimes it is the little things in life that can make a big difference.

Imagine what would happen if you set aside some of the money you routinely spend on entertainment, going out to dinner, or on “impulse buying”, and instead added this money to your retirement account. It may not seem like you are saving much at first, but the simple sacrifices illustrated in the following examples can really add up over the years and make a very significant difference.

* Savings over 30-years assume a tax-deferred account with a compound annual rate of return of 9%, similar to the historical long-term rate for stocks.

Creating a retirement plan, setting personal priorities to find the money to save for retirement, and then having the discipline and commitment to carry through with a plan can make the difference between a successful and fruitful retirement and one of “just barely getting by.” Be sure to consult a financial professional as you put your plans into place, as they will be able to direct and guide you to the retirement plans that are the best fit for you.

Remember, as a general rule, weaker than expected economic data is good for rates, while positive data causes rates to rise.

For the week of November 01 – November 05