Home price growth saw its largest single-month slowdown since 2006 in May as inventory begins to correct, according to Black Knight’s May Mortgage Monitor Report. May was the second straight month of prices cooling across the country. Home price growth slowed in 97 of the U.S.’s 100 largest housing markets. The national appreciation rate fell by more than a whole point YOY. “[W]hile any talk of home values and 2006 might set off alarm bells for some, the truth is that price gains would need to see deceleration at this rate for more than 12 months just to get us back to a ‘normal’ 3-5% annual growth rate,” said Black Knight Data & Analytics President Ben Graboske. “That said, the…
Most consumers think the economy is on the “wrong track,” growing frustrated as they struggle against inflation and a slowing economy. Fannie Mae’s most recent Home Purchase Sentiment Index (HPSI) fell 3.4 points in June to its lowest reading in ten years, while a survey-high 81% of consumers reported they believe the economy is on “the wrong track.” The full index is down 14.9 points YOY. Four of its six components fell from the month prior. More Americans reported they are worried about losing their jobs in the next twelve months (+5%) and fewer reported their income has significantly increased in the past year (-1%.) For the first time in almost seven years, a plurality of respondents said they would…
Mortgage loan application volume fell by 5.4% last week, the Mortgage Bankers Association’s (MBA) weekly survey shows. The adjusted Market Composite Index, a measure of mortgage loan application volume, decreased by 5.4%. The adjusted purchase index dropped 4%, while the unadjusted purchase index increased by 7% and was 17% lower YOY. The refinance index fell by 8% and made up 29.6% of total applications, down 78% from the same time last year. ARM activity fell to 9.5% of total applications. “Mortgage rates decreased for the second week in a row, as growing concerns over an economic slowdown and increased recessionary risks kept Treasury yields lower. Mortgage rates have increased sharply thus far in 2022 but have fallen 24 basis points…
With the July Federal Open Markets Committee meeting fast approaching, speculation about another substantial rate hike is running rampant. After June’s historic 0.75 percentage point interest rate hike, the third hike this year and the largest since 1994, analysts are watching the Fed closely. Recession fears are rapidly growing, with 70% of economists expecting it by 2023. But Federal Reserve Chairman Jerome Powell said he was more concerned about high inflation continuing than about the possibility of rising interest rates causing a recession. “Is there a risk we would go too far? Certainly there’s a risk,” Powell said this week. “The bigger mistake to make, let’s put it that way, would be to fail to restore price stability.” Some experts…
Home sellers are slashing prices at a record pace as buyer activity falls off, Redfin reported. The median asking price for newly-listed homes saw decreased acceleration, rising 15% YOY. It is down 1.5% from its all-time high, which it hit in May. At the same time, a record share of sellers cut their asking price in the four-week period ending June 26. Pending home sales saw their biggest drop since May 2020, as evidence emerges that buyer demand is beginning to cool. But Redfin Chief Economist Daryl Fairweather says buyers aren’t done yet. Instead, they’re noticing “the shift in power, and are no longer leaving the market in droves.” That is, buyers are seeing that sellers are losing the upper…
Mortgage rates reversed their upward trend this week, averaging 5.70%, Freddie Mac reported Thursday. Freddie’s Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) averaged 5.70%, down from last week’s 5.81%. A year ago at this time, the 30-year FRM averaged 2.98%. “The rapid rise in mortgage rates has finally paused, largely due to the countervailing forces of high inflation and the increasing possibility of an economic recession,” said Sam Khater, Freddie Mac’s Chief Economist. “This pause in rate activity should help the housing market rebalance from the breakneck growth of a seller’s market to a more normal pace of home price appreciation.” Recession fears are rapidly growing, with 70% of economists expecting it by 2023. “It’s…
Inventory jumped 18.7% YOY in June, with news listings beating out even typical pre-pandemic levels, Realtor.com reported in its June Housing Report. The number of homes for sale increased at its fastest yearly pace of all time at 18.7%, up 8% from the month prior. This is thanks in part to an influx of new sellers entering the market at a higher rate than in the years before the pandemic. Compared to June 2021, active inventory increased in 40 of the 50 metros analyzed by Redfin, led by Austin, Texas (+144.5%), Phoenix (+113.2%), and Raleigh, N.C. (+111.7%). However, prices have yet to come down as a result of new inventory. The national median listing price instead rose to a new…
Mortgage loan application volume rose slightly by 0.7% last week, the Mortgage Bankers Association’s (MBA) weekly survey shows. The adjusted Market Composite Index, a measure of mortgage loan application volume, increased by 0.7%. The adjusted purchase index rose 0.1%, while the unadjusted purchase index fell by 21% and was 24% lower YOY. The refinance index rose by 2% and made up 30.3% of total applications, down 80% from the same time last year. ARM activity fell to 10.1% of total applications. “Mortgage rates continue to experience large swings. After increasing 65 basis points during the past three weeks, the 30-year fixed rate declined 14 basis points last week to 5.84%,” said Joel Kan, MBA’s Associate Vice President of Economic and…
Annual home price appreciation dipped slightly in April, the first decline in months and a sign that the housing market is finally pumping the brakes. The S&P CoreLogic Case-Shiller Index, which measures average home prices, found that home prices rose by 20.4% YOY, decelerating from March’s read of 20.6%. Though it’s not a drastic fall, the numbers suggest that rising mortgage rates and increasing costs associated with buying a home are deterring buyers. The last time prices decelerated was in November of 2021. “April 2022 showed initial (although inconsistent) signs of a deceleration in the growth rate of U.S. home prices,” said Craig Lazzara, managing director at S&P DJI. “We continue to observe very broad strength in the housing market,…
Good Morning! Today is Monday, June 27. The Supreme Court struck down Roe v. Wade, expanded concealed carry laws, and ruled that school districts cannot prohibit high school football coach’s prayers on field. It is expected to rule on gerrymandering and Congressional regulation of corporations soon. The Mortgage Note Reports Pending Home Sales: Pending home sales finally rose in May after six consecutive months of decreases, ticking up a small but significant 0.7%. CMS CTO: Kendrew Peacey has been named chief technology officer of Constellation Mortgage Solutions. Lumber’s Impact?: Year-to-date lumber prices are down around 50%, but will home prices fall alongside them? Chuck Green reports. And in other mortgage and housing news… Investor Influence: Some analysts hesitate to say investors had an outsized influence on home…
