| QUOTE OF THE WEEK |
| “Let’s have some new cliches.”—Samuel Goldwyn, Polish-born American film producer |
| NATIONAL MARKET UPDATE |
| Mortgage applications slowed the first week of the year, but homebuyers stay interested. A weekly report from an online real estate database found that weekly home tour activity rose over December and year-over-year. Realtor.com reports the median price of homes for sale in December was down almost 2% from a year ago, and the inventory and market share of smaller, more affordable homes continued to grow. Fannie Mae reported housing optimism came in relatively high in December. Their Home Purchase Sentiment Index trended upward for the month, ending “substantially above year-ago levels.” |
| REVIEW OF LAST WEEK |
| JOBS SINK STOCKS… A better-than-expected 256,000 new nonfarm payrolls in December was bad news for the three big stock indexes, as traders feared labor market strength would put the brakes on Fed rate cuts. More reason for the Fed to hold on cuts came with evidence inflation remains a major problem. The ISM Non-Manufacturing report’s prices index rose to the highest level in almost two years. Plus, University of Michigan Consumer Sentiment reported folks remain worried about inflation. And the economy isn’t yet in need of rate cuts to stave off recession—December vehicle sales were up a healthy 5.5% from a year ago. The week ended with the Dow down 1.9%, to 41,938; the S&P 500 also down 1.9%, to 5,827; and the Nasdaq down 2.3%, to 19,162. Meanwhile, the bond market slid overall, the 30-Year UMBS 5.5%, ending down 0.15, to $98.05. Freddie Mac’s Primary Mortgage Market Survey reported the national average 30-year fixed mortgage rate was up a tad from the prior week. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information. DID YOU KNOW… A new report from an online real estate database found housing affordability improved in 2024 for the first time in four years “because wage growth outpaced the growth in monthly housing payments.” |
| THIS WEEK’S FORECAST |
| HOME BUILDING, INFLATION, RETAIL SALES… December should show builders more active, with an increase in Housing Starts, though Building Permits are forecast to come in slightly lower. Unfortunately, inflation is expected to remain in its holding pattern according to the Consumer Price Index (CPI). And those higher prices will contribute to some of the predicted bump in December Retail Sales. |
| FEDERAL RESERVE WATCH |
| Forecasting Federal Reserve policy changes in coming months. Fed watchers now expect no rate cuts at the next three FOMC meets. Note: In the lower chart, the 2,7% probability of change is a 97.3% probability the rate will stay the same. Current rate is 4.25%-4.50%. AFTER FOMC MEETING ON: CONSENSUS Jan 29 4.25%-4.50% Mar 19 4.25%-4.50% May 7 4.25%-4.50% Probability of change from current policy: AFTER FOMC MEETING ON: CONSENSUS Jan 29 2.7% Mar 19 22.1% May 7 34.7% |
| BUSINESS TIP OF THE WEEK |
| Instead of worrying about results that are ultimately beyond your control, focus on the footwork you need to do to get those results. Rather than obsessing about closing the deal, focus on providing the exceptional service that will make it happen. |
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.
