August Markets in a Minute

August Markets in a Minute

August 2, 2018

The Economy

The Fed elected to leave policy rates unchanges at this month's meeting, as was expected. Markets have already priced in 2 more rate hikes this year though.

Consumer spending increased solidly in June, helping drive the economy. Inflation also rose moderately, which could pressure rates higher in the future.

Although the labor market continues to show strength, the construction industry is struggling with labor shortages. Young job seekers just don't seem interested.

Housing News

Home prices were up 6.4% for the year in May, supported by low rates and tight inventory. The pace of price increases is showing signs of slowing.

Pending home sales were down in June from the previous year as inventory continues to be an issue. However, sales were up 0.9% compared to May.

Tight real estate inventory in the Dallas/Fort Worth area is a clear indication of the importance of buyers getting pre-approved for their mortgage. Lack of inventory means that there are more buyers than there are homes, so anyone looking to buy needs to be ready to move quickly once they've found their new home. We specialize in VA loans in Dallas/Fort Worth, first-time homebuyer assistance programs, self-employed mortgage loans, and FHA loan options. Contact us today to get started on your pre-approval.

Construction spending recorded its biggest drop in more than a year in June. Homebuilding has been slowing due to rising material costs and labor shortages.

August 9, 2018

The Economy

Although last week's jobs numbers were lower than expected, employment remains strong. Unemployment claims this week unexpectedly fell to 213,000.

The strong labor market and robust economy are pushing up inflation, which could pressure rates higher. Import duties are also boosting price pressures.

Inflation and strong labor market data have economists forecasting the Fed will raise rates twice more in 2018. Mortgage rates have already factored this in.

Housing News

According to the National Association of Realtors^®, the median price for a single-family home nationwide is at a record $296,000. That's an increase of 5.3% year-over-year.

Weekly mortgage application numbers were down 3% from the previous week. The drop is being blamed on tight inventory and rising home prices.

CoreLogic's Home Price Index shows home prices rose by 0.7% in June over May. CoreLogic forecasts prices will increase 5.1% in the year going forward.

August 16, 2018

The Economy

Instability in the Turkish economy has concerned investors in markets globally. A flight to safety in U.S. bonds has helped mortgage rates this week.

Bolstered by a strong economy, small business confidence is at a 35-year high. Owners are reporting difficulty in filling positions, a sign of the strong labor makret.

Jobless claims fell for a 2nd straight week last week. The data suggests there is no impact yet on the labor market from ongoing trade tensions.

Housing News

New home construction was less than forecast in July, but still increased 0.9%. Permits for future construction were up 1.5% over the previous month.

Homebuilder sentiment fell to the lowest point in almost a year as affordability becomes a bigger worry. However, demand remains strong as rates remain low.

Home searches are stretching on longer as buyers look for the perfect space. Buyers say they are not finding the features they want or a price they can afford.

Regardless of the real estate market, buyers should be encouraged to make informed purchasing decisions, and should not be pressured into making offers on homes that they are not financially viable, or that they aren't truly interested in. This is where having an experienced team committed to customer satisfaction makes all the difference in your homebuying experience.

August 23, 2018

The Economy

The minutes released from the Fed's meeting last month reflected a belief that the economy was growing and a rate hike will be appropriate "soon."

Economists anticipate the Fed will raise rates twice more this year. Markets have already priced in the increases, so mortgage rates likely won't be affected.

Although talks have resumed between the U.S. and China, the trade war continues to escalate. Tariffs are inflationary and could contribute to higher rates.

Housing News

Existing home sales tumbled to a 2 1/2 year low in June, the 4th month of declines. Tight inventory and high prices have some buyers throwing in the towel.

New home sales were also down. A 1.7% drop in July brought them to a 9-month low. However, reports indicate the inventory of new homes is increasing.

Prices continue to rise, up 1.1% from the previous 3 months and up 6.5% from a year earlier. Price gains did slow from the first quarter though.

If you’re looking to purchase a home in the Dallas/Fort Worth area, please take a minute to explore our Dallas/Fort Worth mortgage options, or complete an online mortgage application to get pre-approved.

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.

Markets in a Minute provided by Surefire CRM.

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