By PATRICK LAVERY
Incremental but persistent increases in the Federal Open Market Committee’s policy interest rate have now officially entered a second year, with Federal Reserve Chair Jerome Powell announcing another quarter-percentage point hike on Wednesday.
The target rate is now 5.25%, up five full points since April 2022. Powell reiterated in his prepared remarks that the Fed’s objective is returning inflation to 2%, its historic target.
Unfortunately, Powell acknowledged, interest rates remain stubbornly high. Powell said that for the 12 months ending with this past March, total Personal Consumption Expenditures prices rose 4.2%, excluding food and energy prices which tend to be more volatile, while core PCE prices were up 4.6%.
“Inflation has moderated somewhat since the middle of…
Net new listings and contract volume have officially declined for twelve straight months, according to new data from HouseCanary.
HouseCanary’s latest Market Pulse report, which covers 22 listing-derived metrics and compares data between April 2022 and April 2023, shows market activity was significantly hindered in the first month of Q2.
“As we enter May 2023, the real estate market continues to experience uncertainty, with the purchasing market slowdown being one of the key trends observed for over a year now,” Jeremy Sicklick, Co-Founder and Chief Executive Officer of HouseCanary, said.
Contract and net new listing volume both fell annually, down 17.8% and 39.8%, respectively.
Listings were hit particularly hard by a nearly 45% YOY increase in removals.
Home sellers who…
The 30-year FRM increased once again last week, blocking even more homebuyers from entering the market.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.43%, up from 6.39% the week prior.
A year ago at this time, the 30-year FRM averaged 5.11%.
The 15-year fixed-rate mortgage fell, however, down to 5.71% from 5.76%. A year ago, it averaged 4.40%.
“The 30-year fixed-rate mortgage increased modestly for the second straight week, but with the rate of inflation decelerating rates should gently decline over the course of 2023,” said Sam Khater, Freddie Mac’s Chief Economist.
“Incoming data suggest the housing market has stabilized from a sales and house price perspective. The prospect of lower mortgage rates for the…
Pending home sales sank in March as rate-sensitive buyers continued to skirt the market, according to the National Association of Realtors.
NAR’s Pending Home Sales Index declined by 5.2% between February and March. Year-over-year, it dropped by 23.2%.
All four regions saw pending sales fall YOY, and three of the four saw contract signings shrink. Signings increased slightly in the South as the region continues to attract buyers chasing affordability and sunny weather.
NAR Chief Economist Lawrence Yun pointed to tight inventory as the main hindrance to sales.
“Multiple offers are still occurring on about a third of all listings, and 28% of homes are selling above list price. Limited housing supply is simply not meeting demand nationally,” he said.…
Mortgage applications rose last week despite rates jumping to their highest point in more than a month.
The Mortgage Bankers Association’s weekly survey shows the adjusted Market Composite Index – a measure of mortgage loan application volume – increased by 3.7%, changing course after last week’s 8.8% decrease.
Adjusted purchase applications rose by 5%, while the unadjusted index was up 6% from the week before and 28% lower YOY.
The average interest rate for 30-year fixed loans jumped from 6.43% to 6.55%, a second week of increases and the highest level in more than a month.
“Both conventional and government home purchase applications increased last week. However, activity was still nearly 28% below last year’s pace, as high mortgage rates…
New home sales increased by more than expected in March but remain down significantly from last year, according to new estimates from the U.S. Census Bureau and the Department of Housing and Urban Development.
Sales rose by 9.6% to a seasonally adjusted annual rate of 683,000, compared to just 1.1% in February.
Sales remain down 3.4% YOY, which boasted an annual rate of 707,000.
The seasonally‐adjusted estimate of new houses for sale was 432,000, representing a supply of 7.6 months at the current sales rate.
Inventory remains tight even as more people are home-shopping this spring. As a result, home prices unexpectedly rose in February.
“Homebuyers are window shopping and many are entering the store, but few of them are…
Data released today shows a modest increase in home prices took place in February.
Year-over-year, prices increased by 2%, down from 3.7% in the previous month, according to the S&P CoreLogic Case-Shiller National Home Price NSA Index.
The 20-City Composite posted a 0.4% year-over-year gain, down from 2.6% in the previous month.
“February’s results were most interesting because of their stark regional differences… It’s unsurprising that the Southeast (+7.8%) remains the country’s strongest region, while the West (-4.2%) continues as the weakest,” noted Craig J. Lazzara, Managing Director at S&P DJI.
West Coast hubs that saw huge migration during the pandemic remained negative YOY in February, with San Francisco, Seattle, San Diego, and Portland all experiencing declines.
Southern cities continued…
Mortgage rates jumped last week, breaking a five-week streak of declines.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.39%, up from 6.27% the week prior.
A year ago at this time, the 30-year FRM averaged 5.11%.
The 15-year fixed-rate mortgage also rose, up to 5.76% from 5.54%. A year ago, it averaged 4.38%.
“For the first time in over a month, mortgage rates moved up due to shifting market expectations,” said Sam Khater, Freddie Mac’s Chief Economist.“Home prices have stabilized somewhat, but with supply tight and rates stuck above six percent, affordable housing continues to be a serious issue for many potential homebuyers. Unless rates drop into the mid five percent range, demand will only…
Interest rates increased last week for the first time in more than a month, pushing mortgage applications down.
The Mortgage Bankers Association’s weekly survey says the adjusted Market Composite Index – a measure of mortgage loan application volume – decreased by 8.8%, outstripping last week’s 5.3% increase.
Adjusted purchase applications fell by 10%, while the unadjusted index was down 9% from the week before and 36% lower YOY.
The average interest rate for 30-year fixed loans jumped from 6.30% to 6.43% after ticking down consistently since bank failures last month.
MBA Vice President and Deputy Chief Economist Joel Kan noted that an influx of first-time buyers in the market adds to rate sensitivity, as these buyers lack the flexibility of…
Mortgage rates ticked down again, the fifth straight week of declines.
Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.27%, down from 6.28% the week prior.
A year ago at this time, the 30-year FRM averaged 5%.
The 15-year fixed-rate mortgage fell from 5.64% to 5.54%. A year ago, it averaged 4.17%.
“Incoming data suggest inflation remains well above the desired level but showing signs of deceleration,” said Sam Khater, Freddie Mac’s Chief Economist. “These trends, coupled with tight labor markets, are creating increased optimism among prospective homebuyers as the housing market hits its peak in the spring and summer.”
First-time buyers particularly are feeling prepared to enter the market.
More than half of respondents to…
