Economy Boosts Housing Confidence and FICO Scores by Ron Schulz


Brought to you by Ron Schulz




For the week of september 16, 2019




  Goodbye, boiled water. You will be mist.  





Fannie Mae reports American housing confidence edged up to 93.8 in August, 5.8 points ahead of last year and a new survey high, based on “growing expectations that mortgage rates will remain flat or decline.”

Average FICO [] credit scores hit an all-time high this year, besting last year’s record thanks to “the improved consumer financial health that has resulted from the steady economic growth that the U.S. has experienced.”

Freddie Mac’s chief economist puts “solid home purchase demand” to “healthy underlying consumer economic fundamentals such as a low unemployment rate, solid wage growth and low mortgage rates.”






UP AGAIN… China made nice with the U.S, not raising tariffs on our pork and soybeans. We in turn made nice with them, delaying the next tariff hikes. This helped send stocks up another week, to within 1% of their record highs.

There was also plenty of reason for optimism domestically. The economically healthy American consumer sent August Retail Sales skyward by a strong 0.4%, twice the rate expected.

No doubt disappointing those preaching recession, the U.S. economy just keeps rolling along. Plus, inflation remains low, the August Consumer Price Index and the wholesale Producer Price Index up a scant 0.1%.

The week ended with the Dow UP 1.6%, to 27,200; the S&P 500 UP 1.0%, to 3,007; and the Nasdaq also UP 0.9%, to 8,177.

Rising stocks sparked a bond sell-off. The 30YR FNMA 4.0% bond ended down .27, to $103.42. In Freddie Mac’s Primary Mortgage Market Survey, the national average 30-year fixed mortgage rate was up a tick, but more than a percent below a year ago. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.

DID YOU KNOW?… Just under 60 million Hispanics live in the U.S., yet they account for 63% of homeownership gains in the last 10 years–and the number of homes bought by Hispanics has increased each year since 2015.






HOME BUILDING RISES, EXISTING HOME SALES FALL, JUST LIKE THE FED RATE… Increased builder activity should push August Housing Starts over the 1.2 million unit annual threshold, while Building Permits, pointing to future activity, hold at 1.3 million. But August Existing Home Sales are expected to slip a tick. The Fed. FOMC Rate Decision is forecast as a quarter percent drop.

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… There’s an 82% probability the Fed Funds Rate will drop on Wednesday. That rate should hold in October, with another cut in December. Note: In the lower chart, an 82% probability of change is only an 18% probability the rate will stay the same.

Current Fed Funds Rate: 2.00%-2.25%

Sep 18 1.75%-2.00%
Oct 30 1.75%-2.00%
Dec 11 1.50%-1.75%


Probability of change from current policy:

Sep 18    82%
Oct 30    46%
Dec 11    65%






  If you aren’t moving forward, you’re dropping behind. But progress often involves learning something new, which isn’t as comfy as sticking with what you’ve always done. So if you want to get ahead–get comfortable with being uncomfortable!  


  Ron Schulz
Senior Loan Officer
NMLS# 266128

6060 North Central Exp #462
Dallas, TX 75206

Office: 214-346-5279
Mobile: 214-794-4014 []







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