Market Trends this week in Real Estate

Please enjoy this quick update on what happened this week in the housing and financial markets. The Fed voted not to raise policy rates at this week's meeting, but did leave the door open for a hike before the end of the year. Odds currently favor December. Stocks rallied on the news, hitting new highs. Bonds also improved, which is supportive of lower mortgage rates or better loan pricing. The labor market remains strong, with jobless claims dropping to a two-month low. A strong labor market could play into the Fed's decision to raise rates this year.  Home builders are showing the strongest confidence in the housing market in 11 months, prompted by a surge in interest in new homes following a summer lull. New housing starts were down slightly in August after two months of increases. However, building permits were up, suggesting a rebound in the coming months. Housing inventory remains tight, although demand is strong. Home prices were up 0.5% from June to July, according to the Federal Home Finance Agency. A man goes to the lawyer and asks, "What's your fee?" The lawyer says, "Five hundred dollars for three questions." The man says, "Wow, so much! Isn't that a bit expensive?" The lawyer says, "Yes, I suppose it is. What's your third question?" Rate movements and volatility are based on published, aggregate national averages and measured from the previous to the most recent midweek daily reporting period. These rate trends can differ from our own and are subject to change at any time.

Sincerely,

Christopher Gianino
Pinnacle Real Estate Advisor by Gershman Mortgage
Vice President
NMLS 252641
(314) 280-5662
cgianino@gershman.com
www.PinnacleRealEstateAdvisor.com

this week in the housing and financial markets

what's happened this week in the housing and financial markets. Recent economic data showed signs of underlying inflation. Combined with strong housing and labor markets, this could contribute to higher mortgage rates. However, the latest Fed commentary urged caution, sharing intent to raise policy rates but not until later this year. This could help near term to keep rates steady. Another factor that could help keep rates low is recent retail sales. February's weak sales could signal weakness in the economic outlook, helping rates. Housing starts hit a 5 month high in February as builders ramped up construction. Single-family housing projects surged 7.2% to the highest pace in over 8 years. Building permits were down slightly from January to February, but still up 6.3% over the previous year. Permits for single-family homes rose 0.4% to 731,000. Builder confidence in housing remains strong, noting a continued demand for new inventory. Builders are struggling with enough labor and land to meet the demand. O'Reilly is walking through a graveyard when he comes across a headstone with the inscription, "Here lies a politician and an honest man." "Faith now," exclaims O'Reilly, "I wonder how they got the two of them in one grave!" Rate movements and volatility are based on published, aggregate national averages and measured from the previous to the most recent midweek daily reporting period. These rate trends can differ from our own and are subject to change at any time.

David Sharp
MiMutual Mortgage
Loan Officer
NMLS# 280482
(314) 260-4360
dsharp@mimutual.com
www.mimutual.info/dsharp
Click Here to Review Comments from Past Clients on Zillow

 

This week in real estate

 

	Solid domestic consumer demand helped 3rd quarter GDP estimates to increase 1.5%. Strong economic news can lead to higher rates.

	As expected, the Fed did not raise policy rates at this month's FOMC meeting. However, the statement contained language making a hike in December possible.

	The four-week average for jobless claims is the lowest since 1973. A strong labor market helps strengthen the economy and could lead to higher rates.

	New home sales fell in September after two straight months of gains. However, the drop is seen as temporary, and demand for housing remains strong.

	In fact, the homeownership rate rose between July and September, the first rise after 7 quarterly declines. Buyers under 35 years old had the highest increase.

	First time homebuyers are depending less on gift funds for down payments. More young buyers are using personal savings for down payments and closing costs.