Market Update for the Week of September 17, 2018

MARKET UPDATE

Black Knight reports that in Q2 this year, tappable equity for homeowners with mortgages passed $6 trillion for the first time in history. And this happened even with the recent slowdown in home price growth.

Freddie Mac‘s chief economist thinks the “spectacular stretch of solid job gains and low unemployment should help keep homebuyer interest elevated. However, mortgage rates will likely also move up.”

This doesn’t worry the chief economist at a large regional real estate firm, since  “low unemployment rates encourage employers to raise wages,” which can cover higher loan costs. He also sees “more homes coming on the market.”

REVIEW OF LAST WEEK

STOCKS REBOUND OFF BOOMING ECONOMY… Stocks returned to their winning ways as investors saw tariff threats as negotiating tactics and focused instead on growth in corporate earnings and the overall economy.

Industrial Production set a new record high, Retail Sales are up a strong 6.6% from a year ago, and Americans’ confidence in the U.S. economy and in their own well-being stands near a 14-year high.

Plus, workers are actually doing better than corporations. Since the end of last year, total wages have increased by a $200 billion annual rate, while corporate profits were up by just $100 billion annualized!

The week ended with the Dow UP 0.9%, to 26155; the S&P 500 UP 1.2%, to 2905; and the Nasdaq UP 1.4%, to 8010.

Bond prices dipped for the week after all the good economic data. The 30YR FNMA 4.0% bond ended down .34, at $101.11. Freddie Mac’s latest Primary Mortgage Market Survey saw the national average 30-year fixed mortgage rate up for the third week in a row. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.

DID YOU KNOW?

PropertyShark reports 83% of Generation Z (born1995 to 2010) plans to buy a home in the next five years and get this: the ‘Instagram Generation’ would sacrifice location and commuting distance for size and amenities.

THIS WEEK’S FORECAST

NEW HOMES GOING UP, EXISTING HOMES SELLING… August Housing Starts are expected to shoot past a 1.2 million annual rate. Existing Home Sales should also spring back to a 5.37 million yearly pace.

NOTE: Weaker than expected 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 is dead certain about a rate hike a week from Wednesday, but it sees no moves again until December. Note: In the lower chart, a 100% probability of change is a 0% probability the rate will stay the same.

Current Fed Funds Rate: 1.75%-2.00%

AFTER FOMC MEETING ON: CONSENSUS
Sep 26 2.00%-2.25%
Nov 8 2.00%-2.25%
Dec 19 2.25%-2.50%

 

Probability of change from current policy:

AFTER FOMC MEETING ON: CONSENSUS
Sep 26 100%
Nov 8     6%
Dec 19    80%

 BUSINESS TIP OF THE WEEK

Blogging is the secret weapon for boosting your search engine ranking. Google likes posts of at least 300 words, but no more than 600. Whether you pay a writer or scribe them yourself, blogs, according to the experts, are worth the investment.

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

1300 East Woodfield Road, Suite 302
Schaumburg, IL 60173
Mobile: 847-899-1813
Office: 847-273-3265

Andrea L. Testimonial

I want to thank you for making the process of establishing a loan so easy for us. As a real estate agent in Denver, I have the opportunity to work with a lot of lenders – I know the good ones from the bad ones. And YOU are definitely one of the “good ones”. For my own home purchase, you can imagine how selective I was in working with a lender on our mortgage. I am so glad that we worked with you and CityWide. It’s no secret that the process of procuring a mortgage is extremely stressful, but you made this process as smooth of a transaction that it could have been and given the fact that we lived in Denver, and Marcus was in the middle of a very hectic travel schedule, you met and EXCEEDED our expectations.

Your attention to detail, your personal attention to us and our needs, and your overall professionalism made the biggest difference and the best possible experience for our family. I will recommend you not only to my friends and family but to my clients who are looking for the highest level of service for their mortgage.

Thanks again Jim for everything you did for us. We are so happy to be back home in Naperville, and in our house, that very much feels like home.

Andrea L.