My favorite food group…and your market update!

I hope you had a wonderful Thanksgiving holiday! I ate way too much food…and chocolate. For those that know me well, know that chocolate is my favorite food group.

The weekend was busy with decorating and shopping, so when Monday came along, it wasn’t pretty. But, I managed to make it to the gym 4 days this week, so I’m caught up…I think. Now, please pass the Nuts and Chews. 🙂

Have a wonderful weekend!

Onto the market update…

Investors love the ever-increasing likelihood that the House and Senate are going to present a new tax plan for the President’s signature before the end of the year. The two biggest drivers of excitement in the markets are the plan to reduce the corporate tax rate from 35% down to 20%, and to allow companies to repatriate their offshore cash holdings at the lower tax rate. Simply put, this will be a tremendous financial windfall for corporations and to investors alike.

Many large national corporations have made promises to the White House that if this plan passes with the lower tax rate, they will invest a significant amount of money into corporate expansion. This in-turn will be great for the labor market and increasing wages, as employment demand will soar.

As expected, the tax plan is divided down party lines. Most Republicans are for it, while there is not a single Democrat who will vote “yes” for the plan. Currently the House, Senate, and White House are all Republican controlled, which means that there is little that can be done to prevent the passage of tax reform if every elected Republican votes for it to be implemented.

Mortgage Loan Limit Changes:

This week Fannie Mae, Freddie Mac, and HUD, all announced they are raising their loan limits based on the data showing average home prices increasing around the country. Depending on where a property is located determines how much, if any, the loan limits have been increased.

Home Prices:

On Tuesday both the Federal Housing Finance Agency and Case-Shiller released their latest data on home prices. The FHFA Index showed that home prices continued to rise in September at the rate of 0.3 percent. Home prices compared to the same time last year are higher by 6.3 percent.

The Corelogic Case-Shiller Home Price Index showed similar findings. This index showed home prices up 0.5 percent, and an increase of 6.2 percent from the prior year.

Both reports show considerable strength in housing. Mortgage application activity for home purchases has remained stable. Refinance applications have declined 8.0 percent with the rise in mortgage rates.

Next week’s potential market moving reports are:

 

  • Monday November 27th – New Home Sales
  • Tuesday November 28th – FHFA House Price Index, Corelogic Case-Shiller HPI
  • Wednesday November 29th – MBA Mortgage Applications, Pending Home Sales
  • Thursday November 30th – First Time Jobless Claims
  • Friday December 1st – ISM Manufacturing Survey, Construction Spending

As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends. I welcome the opportunity to serve you in any way I possibly can.  Please feel free to reach me at 661-618-1789.