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MarketMinute | How will the Fed respond to good economic news?

Feb 17

5:09

AM

Category | Markets in a Minute

The inflation rate dropped slightly in January but came in higher than expected. Core inflation without energy and food was up slightly.

Retail sales jumped 3% in January, smashing expectations. No categories saw a decline, following a December in which sales fell 1.1%.

Forecasts for future Fed rate hikes have increased on the stronger economic data, with rate hikes now expected through June.

Housing News

NAHB’s Homebuilder Sentiment Index improved in February by the largest amount in a decade due to an uptick in demand.

New home construction retreated for a 5th straight month in January, reaching the lowest level since June 2020. Building permits also fell.

Though some home prices are retreating slightly, the NAR reports the typical home price has risen 42% in the past 3 years.

MarketMinute | How Are Homebuyers Dealing With Higher Rates?

Feb 10

3:22

AM

Category | Markets in a Minute

Unemployment hit a 53-year low last month, with over 500k new jobs created. The labor market remains strong despite the Fed rate hikes.

Mortgage rates rose as markets began anticipating 2 additional Fed rate hikes that would raise the policy rate to at least 5%.

After constricting in December, the ISM service sector index came in higher than expected in January, a hopeful economic sign.

Housing News

Although still lower than a year ago, purchase mortgage applications rose 3% for the week. Refi apps were up 18%.

Black Knight reports 57% of recent borrowers accessed lower rates with permanent rate buydowns. Nearly 25% paid 2 or more points.

Housing inventory fell by 8,664 units last week. Continuing inventory declines can help mitigate falling home prices.

MarketMinute | How high did home prices go in 2022?

Jan 27

3:11

AM

Category | Markets in a Minute

Despite recession fears, the economy grew at a pace of 2.9% in the 4th quarter, more than the expected 2.6%.

Business activity contracted for the 7th straight month in January. The downturn moderated across both the manufacturing and services sectors.

Jobless claims declined again last week, this time to 186K. The drop signals labor market strength despite Fed rate hikes and talk of recession.

Housing News

NAR reports the median home sales price in 2022 was $386,300, up 10.2% from 2021 and the highest on record.

Existing home sales in December fell for the 11th straight month and hit the slowest pace since 2010. Improvements are expected in 2023.

However, new home sales rose 2.3% in December. The 3rd straight monthly increase shows homebuyers are still shopping.

MarketMinute | How Much Did Mortgage Application Volume Jump?

Jan 20

3:19

AM

Category | Markets in a Minute

A recent Fed survey showed the economy held steady in early January. Some regions experienced modest declines in activity.

Prices for wholesale goods and services fell sharply in December, providing another sign that inflation is beginning to ease, though still high.

December's retail sales fell by the most in a year, and business equipment production slumped, indicating the economy may be losing momentum.

Housing News

Homebuilder sentiment posted an unexpected gain in January, rising for the first time in 12 months.

Single-family homebuilding rebounded with an 11.3% increase in December. Total new home construction fell for a 4th straight month.

Mortgage application volume jumped nearly 28% for the week, with purchase apps rising 25% over the previous week.

MarketMinute | Looking For Rate Predictions?

Jan 13

5:18

AM

Category | Markets in a Minute

More new jobs than forecast were created in December. However, wage growth was lower than expected, helping mortgage rates.

Inflation continued to slow in December, signaling prices have peaked and giving markets hope the Fed will slow the pace of interest rate hikes.

Weakening demand in December led to the first services industry contraction in more than 2-1/2 years, signaling a slowing economy.

Housing News

Mortgage applications rose 1.2% last week over the previous week, although purchase applications were down 1% on the week.

NAR's Nadia Evangelou, director of forecasting, predicts mortgage rates likely will settle below 6% and experience less volatility this year.

In December, 21% of survey respondents told Fannie Mae now is a good time to buy a home, up from 16% in November.