I hope you had a wonderful Thanksgiving holiday!
This time of year can be a little crazy in the financial markets as trading volume drops off because traders take time off for the holidays and so we often see increased volatility because smaller moves make bigger ripples when trading volume is lower. Nevertheless, mortgage rates continued to see a marked improvement going into the long holiday weekend, and interestingly, we haven’t yet seen a rush back into the market by buyers.
What this means for you is that if you’ve been waiting for a favorable purchase window, now could be an opportune time with rates lower and less competition for homes. Reach out (either call, text, or email me), and let’s explore your scenarios.
According to the weekly mortgage rate survey published by Freddie Mac, rates continue the trend of the past few moving lower due to “bond-friendly” economic news. Data has shown inflation has continued to ease, unemployment has ticked up, and the economy overall is showing signs of softening.
Then there’s the geopolitical landscape and the uncertainty there. Markets do not like uncertainty, so any risk of growing tensions in the Middle East leads to investors moving money to the safety of bonds, which helps mortgage rates improve. Also, it’s becoming more likely the Fed has finished hiking rates.
What I’m watching this week…
Already seeing some interesting housing data come out. New Home Sales were reported on Monday and missed expectations. From a lower-than-expected 676,000 in August and September’s much higher-than-expected 759,000, forecasters predicted annual sales falling back to 725,000 in October; however, they missed by an even greater margin, coming in at 679,000.
Pending home sales in October, which in September rebounded 1.1 percent after falling 7.1 percent in August, are expected to fall back 2.0 percent. The official numbers come out on Thursday.
Home price appreciation remains healthy, according to the latest Case-Shiller Home Price Index. Forecasters correctly predicted the monthly rate rising 0.7 percent in September versus August’s strong 1.0 percent increase. The annual rate of appreciation was 2.2 percent in August and came in a touch higher – at 3.9 percent – than the predicted 3.8 percent.
The second estimate of third-quarter GDP, at 4.9 percent consensus growth, is expected to show no change from 4.9 percent growth in the quarter’s first estimate.
The Fed’s favorite inflation indicator, the PCE Index, comes out on Thursday and will be closely watched. Inflation readings for October are expected at muted monthly increases of 0.1 percent overall and 0.2 percent for the core – minus food and energy cost – (versus September’s increases of 0.4 and 0.3 percent). Annual rates are expected at 3.1 percent overall and 3.5 percent for the core (versus September’s 3.4 and 3.7 percent).
We’ll have to wait until next Friday to see the official Jobs numbers.
