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.

 

Happy 4th!

Happy long weekend!! Are you one of the lucky ones taking Monday off too? Nothing like a 4-day weekend to decompress and recharge the batteries!

I’ll be heading to the beach tomorrow for some family time and to escape this heat! The rest of the weekend will be low key for me, which is a welcome change!

I hope you have an absolutely wonderful weekend and allow yourself to rest and recharge. Stay safe on the roads! Happy Independence Day!!

Please feel free to call me if you have any loan questions or to get pre-approved!

 Onto the market update…

In recent weeks, I have been mentioning how the Summer and Fall housing markets are being predicted, by some experts, to be far above average. We should hope they are correct on account that the early Spring market was a rather large disappointment.

The latest Case-Shiller’s home price index increased by a rather small 0.3 percent in April. In February, home prices were up by 6.0 percent from the same time in the prior year. However, for the month of March, the year-on-year rate slipped back down to 5.7 percent. This is the first reversal in year-on-year spread in a very long time,

To the surprise of many, San Francisco home prices dropped 0.6 percent in the month. Boston was down by 0.7 percent and Cleveland declined by 1.0 percent. Not surprising, is Seattle leading the country with a year-on-year spread up by 12.9 percent.

Mortgage Bankers Association Loan Application Weekly Data

For the week ending June 23rd, purchase applications for home mortgages dropped by a seasonally adjusted 4 percent. The unadjusted level is actually 8 percent higher than the level in the same week a year ago. Refinancing plummeted 9 percent from the prior week, with the refinance share of mortgage activity declining to 45.6 percent of all originations.

Pending Home Sales

May was the 3rd month in a row of decline with a jaw dropping 0.8 percent. This is in direct contrast to expert predictions of a 0.5 percent gain. The weakness in the housing market is spread evenly throughout regions across the country. The West, usually the strongest market, declined by 1.3 percent, which was the largest decline recorded for the month. Although the data on final home sales does not always move in lock-step with the pending home sales data, this most recent report could prove troubling for future final sales data.

Next week’s potential market moving reports are:

 

  • Monday July 3rd – ISM Mfg Index, Construction Spending
  • Tuesday July 4th – Independence Day Celebration – All Markets Closed
  • Wednesday July 5th – MBA Mortgage Applications, Factory Orders, FOMC Minutes
  • Thursday July 6th – First Time Jobless Claims, ADP Employment Report
  • Friday July 7th – National Employment Situation

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.