News of rising inflation pounded markets that had previously been shrugging it off month after month thinking it was “transitory” as the Fed called it. Well, last week’s reports on consumer prices showed them rising an unexpected 6.2 percent year-over-year, a level that traders could no longer ignore. Since then, rates have risen in response as bond investors watched their investment dollars becoming worth less and less.
The effects of higher inflation has spilled over into mortgage rates pushing them higher, a trend I believe will continue for the foreseeable future.
Even though rates have crept up, they still remain at amazingly low levels historically. This is still an opportune time of year to consider consolidating higher interest debt and setting yourself up for a financially sound and secure New Year, using all the equity your home has created for you. Let me know if you’d like to discuss your options and what this looks like for you!
The housing market continues to show underlying strength as mortgage applications have only dropped 4% even as rates have risen, inventory is down 13%, and cash buyers continue to be active.
This week, as the holiday shopping season nears, we saw a report on Retail Sales revealing headline sales easily beat expectations for October, coming in at 1.7% increase after both August and September grew more than expected too.
Sentiment of the nation’s home builders revealed rising optimism continues after a sharp rebound last month, following a bumpy ride in prior months this year.
New Housing Starts and Permits – a leading indicator of the health of the housing market – have been up and down and are expected to be up sharply in October. A 1.587 million annual rate is expected for October starts versus 1.555 million in September with permits seen at 1.630 million versus 1.586 million.
Wishing you a wonderful week!