Home Building, Mortgages, Prices all Rise by Ron Schulz

 

 

Brought to you by Ron Schulz

 

 

 

For the week of september 9, 2019

 

 

YOUR WEEKLY SMILE

Misers aren’t fun to live with, but they make wonderful ancestors.–David Brenner, American stand-up comedian

 

 

NATIONAL MARKET UPDATE

 

Low inventory continues to be a problem in many areas, but a positive sign was seen in the U.S. Census Bureau’s report that residential construction spending [em.mediacenternow.com] rose 0.6% for the month of July.

With today’s low mortgage rates, purchase mortgage applications increased 4%, seasonally adjusted, from the week before, and refinance applications for the week were 152% higher than a year ago!

Supply constraints are pushing prices up, though at a slower pace. But buyers should act, as annual home price gains are still forecast up 5.4% by CoreLogic, up 4.3% by Fannie Mae, and up 3.8% by the Mortgage Bankers Association.

 

 

REVIEW OF LAST WEEK

 

MARKETS UP, NEAR RECORD HIGHS… Stocks posted gains two weeks in a row, as all three market indexes neared record highs. The catalysts? China agreed to October trade talks in Washington, plus some strong economic data.

Strongest of all, non-manufacturing activity (the bulk of our economy) grew at an accelerated rate in August. Yes, manufacturing activity contracted, yet that happened nine times from 2012 to 2015 without stopping overall expansion.

Some pundits freaked that we got “only” 130,000 new jobs in August. But civilian employment (including small business startups) rose by 590,000, the labor force grew by 571,000, and wages gained 3.2% year-over-year. Impressive.

The week ended with the Dow UP 1.5%, to 26,797; the S&P 500 UP 1.8%, to 2,979; and the Nasdaq also UP 1.8%, to 8,103.

With stocks on the rise, bonds dipped a tick for the week. The 30YR FNMA 4.0% bond ended down .11, at $103.69. The national average 30-year fixed mortgage rate fell to another three-year low 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?… The NAR’s chief economist says today’s home building labor shortage is because the crisis took us from 2.2 million units a year to 600,000, and stayed there three years. Laborers who were no longer needed retired, left the country, or took  more sustainable jobs.

 

 

THIS WEEK’S FORECAST

 

INFLATION STAYS MILD, RETAIL STAYS UP… Consumer price inflation in August measured by the Consumer Price Index (CPI) is forecast below the Fed’s 2% target, while Core CPI, excluding food and energy prices, should come in just above it. Consumers aren’t having a problem paying current prices, as August Retail Sales are predicted to keep heading up.

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.

 

 

FEDERAL RESERVE WATCH

 

Forecasting Federal Reserve policy changes in coming months… There’s just under a 100% certainty of a September rate cut. It looks good for another one in October, but none in December. Note: In the lower chart, a 91% probability of change is only a 9% probability the rate will stay the same.

Current Fed Funds Rate: 2.00%-2.25%

AFTER FOMC MEETING ON: CONSENSUS
Sep 18 1.75%-2.00%
Oct 30 1.50%-1.75%
Dec 11 1.50%-1.75%

 

Probability of change from current policy:

AFTER FOMC MEETING ON: CONSENSUS
Sep 18    91%
Oct 30    60%
Dec 11    53%

 

 

 

BUSINESS TIP OF THE WEEK

Everyone you’re working with now is your best source of business for the future, so cultivate those relationships. Pay attention to the details, exceed expectations, and stay in touch going forward.

 

Ron Schulz
Senior Loan Officer
NMLS# 266128
6060 North Central Exp #462
Dallas, TX 75206

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

 

 

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This e-mail is an advertisement for Ron Schulz. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Supreme Lending and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Supreme Lending. ADVERTISEMENT. Offer not contingent on use of specific settlement service provider. ADVERTISEMENT. EVERETT FINANCIAL, INC. D/B/A SUPREME LENDING NMLS ID #2129 (www.nmlsconsumeraccess.org) 14801 Quorum Dr., #300, Dallas, TX 75254. 877-350-5225. Copyright © 2019. Not an offer or agreement. Information, rates, & programs are subject to change without prior notice. Not available in all states. Subject to credit & property approval. Not affiliated with any government agency. Supreme Lending is required to disclose the following license information: AZ Mortgage Banker License 0925918. Licensed by the Department of Business Oversight under the CA Residential Mortgage Lending Act License 4130655. CO Mortgage Company – Regulated by the Division of Real Estate. Delaware Lender License 10885. GA Mortgage Lender License 22114– Georgia Residential Mortgage Licensee. IL Residential Mortgage License MB.6760323-DBA1– Illinois Residential Mortgage Licensee. MA Mortgage Broker License MC2129. MA Mortgage Lender License MC2129. Licensed by the N.J. Department of Banking and Insurance – New Jersey Residential Mortgage Lender License. Licensed Mortgage Banker-NYS Department of Financial Service. NY Mortgage Banker License B501049. Ohio Mortgage Broker Act Certificate of Registration MB.804158.000. Ohio Mortgage Loan Act Certificate of Registration SM.501888.000. OR Mortgage Lending License ML-4265. Licensed Mortgage Banker by the PA Department of Banking – Pennsylvania Mortgage Lender License 45048. Rhode Island Licensed Lender 20142998LL.

 

 

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