Housing Starts Soar, Existing Home Sales Gain by Ron Schulz

 

 

Brought to you by Ron Schulz

 

 

   

For the week of september 23, 2019

 

 

YOUR WEEKLY SMILE

 
  What kind of dog does a chemist have? A Lab!  

 

   

NATIONAL MARKET UPDATE

 
   

Housing Starts [em.mediacenternow.com] shot up 12.3% in August, to a 1.364 million annual rate, a new post-recession high. And Building Permits gained 12.0% over a year ago, to a 1.419 million yearly rate, another post-recession record.

No wonder builder confidence hit an 11-month high! Meanwhile, Existing Home Sales [em.mediacenternow.com] have now risen two months in a row, up 1.3% in August, to a 5.490 million annual rate, 2.6% above a year ago.

Housing activity is clearly gaining momentum with a nice rise in purchase demand.  The Mortgage Bankers Association reports purchase mortgage applications up 15% from a year ago. Credit the strong labor market and low interest rates.

 

 

   

REVIEW OF LAST WEEK

 
   

BACK AND FORTH… Investor sentiment fluctuated and the three big stock indexes ended slightly lower after three weeks of gains. The first downer was the attack on Saudi refineries that created the worst oil supply disruption in history.

But the Saudis began restoring production quickly and the conflict didn’t escalate. More good news came when the U.S. granted China tariff exemptions, but then Chinese representatives aborted a friendly visit to farms in Montana. Har-umpf!

We had the Fed’s expected rate cut to “sustain the expansion,” which has been doing fine all by itself, with 3.7% unemployment, the strongest wage growth in over a decade, and consumer spending up an average of 3% since 2018.

The week ended with the Dow down 1.0%, to 26,935; the S&P 500 down 0.5%, to 2,992; and the Nasdaq down 0.7%, to 8,118.

All the back-and-forths sent bond prices up as investors sought a safe haven. The 30YR FNMA 4.0% bond ended UP .22, to $103.64 The national average 30-year fixed mortgage rate in Freddie Mac’s Primary Mortgage Market Survey saw its biggest uptick since October, but is almost 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?… Thanks to the drop in mortgage rates, Fannie Mae’s latest forecast projects refinances at a three-year high. Even with last week’s rate move, refinance applications were 148% higher than a year ago.

 

 

   

THIS WEEK’S FORECAST

 
   

NEW AND PENDING HOME SALES, CONSUMER INCOME AND SPENDING, GDP, ALL UP… The “looming” recession forecasters keep having this problem: the economic data won’t cooperate, as we should continue to see this week. August New and Pending Home Sales are expected to show the housing recovery intact. Personal Income and Spending are predicted to reveal consumers making more money and spending it, sending the third estimate for Q2 GDP to solid 2.0% growth.

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… The Fed Futures market expects the rate to hold in October, drop come December, then hold in January. Note: In the lower chart, a 45% probability of change is a 55% probability the rate will stay the same.

Current Fed Funds Rate: 1.75%-2.00%

AFTER FOMC MEETING ON: CONSENSUS
Oct 30 1.75%-2.00%
Dec 11 1.50%-1.75%
Jan 29 1.50%-1.75%

 

Probability of change from current policy:

AFTER FOMC MEETING ON: CONSENSUS
Oct 30    45%
Dec 11    63%
Jan 29    55%

 

 

 

   

BUSINESS TIP OF THE WEEK

 
  Sure, you can land a client on the first contact. But 80% of sales are made on the fifth to twelfth contact. Follow up, follow up, follow up!  

 

  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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