Market Update For the Week of March 19, 2018

Info That Hits Us Where We Live

After a spectacular January, Housing Starts took a break in February, dipping 7.0%, to a 1.236 million annual rate, all due to multi-families. Starts are still close to a post-recession high, single-family starts up 2.9% for the month and 2.9% for the year.

Building Permits also fell for the month, but gained for the year, 4.6% for single-families, 10.6% for multi-families. So the future looks bright, with the National Association of Home Builders sentiment index historically high, though it slipped slightly for the month.

The National Association of Realtors (NAR) reports that in 2017, 34% of all home purchases were made by Millennials, giving that generation the highest share of home buyers five years in a row. They’re also the most likely group to purchase through an agent.

Business Tip of the Week

To stand out as an expert, really dig into what you need to know. If you just scan the headlines, you’ll only get what everyone else does–an incomplete story, missing important details. Take the time to digest all the info you can.

Review of Last Week

UP FINISH TO A DOWN WEEK… A volatile week on Wall Street ended with the three major indexes down, although Friday’s economic data sent stock prices back up. Trade war worries and personnel changes at Secretary of State and chief economic adviser to the president drove the sell off.

Good economic reports included Industrial Production rising at its fastest pace in four months, while University of Michigan Consumer Sentiment shot up to a 14-year high, its 102 reading well above the long-term average of 86.

Small business optimism is at its second highest lever ever, and the CEO Confidence survey hit 63, well into positive territory above 50. Even a dip in Retail Sales was positive, showing the economy isn’t so hot that the Fed will need more than three planned rate hikes this year.

The week ended with the Dow down 1.5%, to 24947; the S&P 500 down 1.2%, to 2752; and the Nasdaq down 1.0%, to 7482.

For the most part, it was prices down, yields up in the bond market, hinting rates may rise. The 30YR FNMA 4.0%, bond we watch ended the week down .02, at $102.36. But national average 30-year fixed mortgage rates actually fell for the first time in 2018 in Freddie Mac’s latest 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?

J.D. Power reports that 2017 was the first year purchase and refinance customers cited online/website as the most frequent method of submitting a mortgage application.

This Week’s Forecast

NEW AND EXISTING HOME SALES GROW, THE FED TAKES A HIKE… Analysts say we’ll see Existing Home Sales inch toward the 5.5 Million annual rate, and New Home Sales back over 600,000 per year. Almost everyone expects the Fed to take a quarter percent hike in their FOMC Rate Decision.

The Week’s Economic Indicator Calendar

Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.

Economic Calendar for the Week of Mar 19 – Mar 23

Date Time (ET) Release For Consensus Prior Impact
Mar 21
10:00 Existing Home Sales Feb 5.42M 5.38M Moderate
Mar 21
10:30 Crude Inventories 03/17 NA +5.0M Moderate
Mar 21
14:00 FOMC Rate Decision Mar 1.50%- 1.75% 1.25%- 1.50% HIGH
Mar 22
08:30 Initial Unemployment Claims 03/17 225K 226K Moderate
Mar 22
08:30 Continuing Unemployment Claims 03/10 NA 1.879M Moderate
Mar 22
10:00 Leading Economic Index (LEI) Feb 0.5% 1.0% Moderate
Mar 23
08:30 Durable Goods Orders Feb 1.5% -3.7% Moderate
Mar 23
08:30 Durable Goods Orders – ex transportation Feb 0.6% -0.3% Moderate
Mar 23
10:00 New Home Sales Feb 620K 593K Moderate


Federal Reserve Watch

Forecasting Federal Reserve policy changes in coming months… The Fed futures market sees a quarter percent rate hike this Wednesday, nothing in May and then another quarter percent increase in June Note: In the lower chart, a 94% probability of change is a 94% certainty the rate will move higher.

Current Fed Funds Rate: 1.25%-1.50%

After FOMC meeting on: Consensus
Mar 21 1.50%-1.75%
May 2 1.50%-1.75%
Jun 13 1.75%-2.00%


Probability of change from current policy:

After FOMC meeting on: Consensus
Mar 21        94%
May 2        11%
Jun 13        70%

Statistics source:

Material in this article from: Inside Lending Market Snapshot

This is an advertisement for Jim Passi. 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 Citywide Home Loans 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 Citywide Home Loans. Citywide CO NMLS #67180. Regulated by the Division of Real Estate.

The Jim Passi Team at Citywide Home Loans proudly serves Illinois, Wisconsin, Michigan, Indiana, Georgia and Flordia. If you are looking to buy a home or refinance, we have you covered. Apply Now to get started.
Posted in
Jim Passi - Citiwide Home Loans

Jim Passi
Regional Manager
NMLS# 158000

1284 West Northwest Hwy.
Palatine, IL 60067
Mobile: 847-899-1813

Jim Passi was extremely easy

Jim Passi was extremely easy to work with. He worked very hard to get me exactly what I needed and went above and beyond my expectations. I was at ease through this whole process knowing Jim was always looking out for my best interest. I would highly recommend Jim to anyone who needs a professional and dedicated loan officer.

Michelle B.