It’s Taking an Average of Just 17 Days to Sell!

As the economy approves and the pandemic continues to be a concern, mortgage rates increased in this week’s survey, yet again. We saw in reports last week that the availability of existing homes is improving, which is good news for buyers even as rising interest rates may slow things down a bit. However, just to illustrate the heat in the housing market, it’s currently taking an average of just 17 days to sell a home!

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So, yes, rates are moving higher. According to the weekly survey by Freddie Mac, both the 30-year and 15-year average fixed rates moved up slightly by .04 and .03 respectively. And based on what we’re expecting to see in this week’s inflation reports, we could see the trend continue. 

What I’m watching this week…

There’s a healthy and interesting dose of housing news set to be released this week. Already we’ve seen the rate of home price appreciation come out. Case-Shiller’s home price index was expected to rise a monthly 1.3 percent in August but came in a little higher at 1.4 percent for year-over-year growth of 20.0 percent. July’s respective results were gains of 1.5 and 19.7 percent.

New Home Sales numbers also came out and though slowing, have remained strong and stable. Sales for September beat expectations of 760,000 coming in at 800,000 versus August’s higher-than-expected 740,000 annual pace.

The housing market’s leading indicator, Pending Home Sales, comes out this week too. Before August’s 8.1 percent burst higher, pending home sales had been flat. A still very strong 1.7 percent rise is the expectation for September.

Within a very wide 1.6 to 4.8 percent consensus range, third-quarter GDP (gross domestic product) is expected to slow to 2.7 percent annual growth versus second-quarter growth of 6.7 percent. Personal consumption expenditures, after the third-quarter’s 12.0 percent rise, are expected to post annual growth of only 0.7 percent.

On Friday we’ll get a look at the Fed’s favorite inflation indicator – the PCE Index – which has the greatest potential to move markets this week. Rates have drifted higher in the past week largely because of inflation concerns. Inflation readings are expected at 0.4 percent overall but only 0.2 percent for the core for annual rates of 4.5 and 3.7 percent (versus August’s 4.3 and 3.6 percent). Any surprises here could cause some volatility in rates. 

Have a great week!