New Year-New Book!

I hope your holidays and New Year celebrations were wonderful! I was able to enjoy a little down time, including a trip to Disneyland. I love that place during Christmas! The lights and decorations bring out the kid in me.

I was also able to work on the final pieces of my new book, “Money Rules 101- Master Your Money Before it Masters You,” which should be out February! I’m super excited about this book, as I know it will help everyone who reads it. I’ll be starting an interest list soon, so watch for that coming!

Enjoy your weekend!

 Onto the market update…

Now that the holidays are over, let’s see if the Dow Jones Industrial Average can break the 20,000 mark. Last week the index came very close, but investor concerns about U.S. and China trade relations had many sitting on the sidelines. In addition, many people are just getting back from vacation and getting things going for the New Year and the stock market was not their primary focus.

Even though this week had enough economic news to impact the markets, it did not seem like many were paying attention. The ADP Employment Report, which typically can draw a significant market reaction, didn’t seem to do much in the investment community. ADP reported a softer labor report than most experts had anticipated. ADP announced that 153,000 new jobs were added in December. Analysts were expecting closer to 172,000.

In the housing market, construction spending picked up heading into the latter part of the year. The latest report for November 2016 showed a jump in spending by 0.9 percent. That was significantly higher than analyst’s expectations. Additionally, the spread between construction spending at this point versus the prior year increased to 4.1 percent. This was a healthy increase from the prior month in which the spread year over year was only 3.4 percent. This is the best reading on construction spending since June 2016. Residential construction accounted for a 1.0 percent increase in the report and the largest portion of the gain was in single family sector.

The Mortgage Bankers Association of American reported huge declines in refinance applications for the final week of the year. According to the MBA’s latest report, refinance applications declined 22.0 percent. Purchase applications only dipped 2.0 percent despite it being a major vacation week. Mortgage rates have stopped moving upward and have even declined slightly in the last couple of weeks. Now that the holidays are over, many eyes will be watching the direction of the housing market. Many experts are anticipating the purchase and sale market to be the best since the 2008 recession.

On Wednesday, the FOMC released their minutes from the Open Market Committee Meeting. The theme that seemed to come from reading the minutes is that the Fed is taking a wait and see attitude toward future rate increases. There are many uncertainties regarding future government spending and tax cuts under the Trump presidency. Any of the talked about initiatives can have a major impact on inflation and economic productivity. For the time being, the Fed is planning for two interest rate increases in 2017. However, they clearly indicated that they will adjust their forecasts as needed with so much unchartered governmental decisions lying ahead.

Next week’s potential market moving reports are:

 

  • Monday January 9th – Labor Market Index
  • Tuesday January 10th – JOLTS Report
  • Wednesday January 11th – MBA Applications
  • Thursday January 12th – First Time Jobless Claims
  • Friday January 13th – Producer Price Index and Retail Sales

 

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.