Home Sales Slip, Loan Limits Soar by Ron Schulz


Brought to you by Ron Schulz




For the week of december 2, 2019




  Life’s real failure is when you do not realize how close you were to success when you gave up.–Anonymous  





October New Home Sales [em.mediacenternow.com] slipped 0.7% from September, entirely due to a big 32,000 upward revision to the prior month’s read. The 733,000 unit annual rate still put sales up 31.6% from a year ago.

The Pending Home Sales [em.mediacenternow.com] index of contracts signed on existing homes slid 1.7% in October. But they jumped 4.4% year-over-year, and after the 1.4% increase in September, we should see a gain in existing home sales come November.

The Federal Housing Finance Agency [em.mediacenternow.com] raised the 2020 limit for generally lower-rate conforming loans to $510,400 for most areas. Beyond that limit are generally higher-rate jumbos. Please contact us for details.






HAPPY THANKSGIVING!… In three and a half days of trading, Wall Street gave us one more thing to be grateful for: the stock market hit its 26th all-time high of the year, ending the week with a nice gain.

Investors were buoyed by a Phase I trade deal with China looking more likely, and solid economic data. We had another drop in initial unemployment claims, and a gain in consumer spending for the eighth month in a row.  

Personal income is up 4.4% the past year, with inflation well under the Fed’s 2% target. And the economy grew a better-than-expected 2.1% in Q3, is up 2.2% from a year ago, and up at a 3.0% annual rate the past two years.

The week ended with the Dow UP 0.6%, to 28,051; the S&P 500 UP 1.0%, to 3,141; and the Nasdaq UP 1.7%, to 8,665.

Gloomy global economic data kept investors in bonds. The 30YR FNMA 4.0% bond ended UP .05, at $103.75. We saw a slight increase in the national average 30-year fixed mortgage rate, which stayed more than 1% lower than a year ago, in Freddie Mac’s Primary Mortgage Market Survey. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.

DID YOU KNOW?… A recent survey found 93% of respondents in Generation Z (born 1995 or later) see homeownership as something to be proud of. Only 19% feel renting is more appealing than owning a home, versus 30% of older Millennials.






MANUFACTURING, SERVICES SECTOR, JOBS, WAGES ALL GAIN… The economy continues to look pretty good. The ISM Services measure of the sector that makes up the vast majority of our economy should report additional growth, along with Nonfarm Payrolls and Average Hourly Earnings. Even manufacturing, still in contraction, is expected to show improvement.

NOTE: Weaker economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and higher loan rates.






Forecasting Federal Reserve policy changes in coming months… Wall Street feels the Fed’s recent rate cut will be its last until we get to spring. Note: In the lower chart, a 5% probability of change is a 95% probability the rate will stay the same.

Current Fed Funds Rate: 1.50%-1.75%

Dec 11 1.50%-1.75%
Jan 29 1.50%-1.75%
Mar 18 1.50%-1.75%


Probability of change from current policy:

Dec 11     5%
Jan 29    13%
Mar 18    20%






  Gratitude is a good thing to feel every day. Reflect each morning on something you’re grateful for. Take an attitude of gratitude into the day, and your positive energy will prove to be infectious to clients, prospects, and partners.   


  Ron Schulz
Senior Loan Officer
NMLS# 266128

6060 North Central Exp #462
Dallas, TX 75206

Office: 214-346-5279
Mobile: 214-794-4014
www.ronschulz.com [em.mediacenternow.com]







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