| QUOTE OF THE WEEK |
| “I once wanted to become an atheist, but I gave up—they have no holidays.”—Henny Youngman, American comedian |
| NATIONAL MARKET UPDATE |
| Pending Home Sales (signed contracts on existing homes) rose in October for the third straight month and are more than 5% up from last year. The National Association of Realtors noted, “Homebuying momentum is building.” October New Home Sales didn’t fare so well, down over 17%, as two hurricanes delayed sales in the south. But good news for buyers, the median new home sales price is down 5% and completions are up over 265% versus 2022. Case-Shiller home prices booked their sixth straight month of slowing annual price gains. Home price growth also slowed in the FHFA index, continuing a trend that began in the fourth quarter last year. |
| REVIEW OF LAST WEEK |
| BLACK FRIDAY BOOST… The week ended with stock prices heading up while retail prices headed down. The Dow and S&P 500 finished November at record highs, capping off their best monthly performances in a year. The holiday-shortened week offered a variety of economic news. We got PCE prices rising at a 2.3% annual rate overall, 2.8% excluding volatile food and energy—still above the Fed’s 2% target. But durable goods orders bounced back a tick in October after dropping three of the past four months. Plus, Preliminary Q3 GDP had the economy growing at a modest 2.8%, and initial jobless claims fell, though continuing claims rose. The week ended with the Dow UP 1.4%, to 44,911; the S&P 500 UP 1.1%, to 6,032; and the Nasdaq UP 1.1%, to 19,218. Bonds booked strong performances overall, though the 30-Year UMBS 5.5% slipped 0.12, to $98.18. Freddie Mac’s Primary Mortgage Market Survey reported the national average 30-year fixed mortgage rate went down a tad. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information. DID YOU KNOW… Serious homebuyers are showing up. The Mortgage Bankers Association reports that last week the seasonally adjusted index of purchase mortgage applications shot up 12% from the week before. |
| THIS WEEK’S FORECAST |
| CONSTRUCTION SPENDING, MORTGAGE APPLICATIONS, CONSUMER SENTIMENT, JOBS… October Construction Spending is predicted to increase overall, but our interest will be the residential part. We’ll also keep an eye on the MBA Mortgage Applications Index to look for more buyer activity. Analysts expect the University of Michigan Consumer Sentiment-Preliminary read to move up in December. November should post considerably more new Nonfarm Payrolls than October, though the Unemployment Rate is forecast to move up. |
| FEDERAL RESERVE WATCH |
| Forecasting Federal Reserve policy changes in coming months. The market sees a quarter percent rate cut in December, then a hold. The consensus is for the Fed to stay there in March but sentiment is mounting for another quarter percent drop. Note: In the lower chart, the 65.2% probability of change is a 65.2% probability the rate will drop. Current rate is 4.50%-4.75%. AFTER FOMC MEETING ON: CONSENSUS Dec 18 4.25%-4.50% Jan 29 4.25%-4.50% Mar 19 4.25%-4.50% Probability of change from current policy: AFTER FOMC MEETING ON: CONSENSUS Dec 18 65.2% Jan 29 42.6% Mar 19 48.9% |
| BUSINESS TIP OF THE WEEK |
| The more you learn, the more you earn. Warren Buffet: “Generally speaking, investing in yourself is the best thing you can do. Anything that improves your own talents—nobody can tax it or take it away from you…. But if you’ve maximized your talent, you’ve got a tremendous asset that can return 10-fold.” |
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.
