| “In theory, there is no difference between theory and practice. In practice, there is.”—Yogi Berra, American professional baseball player, manager, and coach |
| In May, the total number of listings topped 1 million homes for the first time since before the pandemic, while in April, the total value of homes for sale surged to a record $698 billion, up 20.3% from last year. The Mortgage Bankers Association’s weekly survey reported that mortgage applications “continue to exhibit annual gains, with purchase applications running 18% ahead of last year’s pace.” Overall spending on residential construction in April came in a smidge below the revised March estimate, but spending on single-families, though also off a bit for the month, were only 2.2% lower than a year ago. |
| GOOD JOBS, GREAT MARKETS… The S&P 500 soared to 6,000 in the wake of a better-than-expected May jobs report, along with the news the President’s top trade reps will meet with the Chinese in London today. As usual, all was not upbeat, as the May ISM Manufacturing Index stayed in contraction territory, joined by the ISM Services Index, indicating a slowing economy. But the April trade deficit plunged to $61.6 billion. And May saw 139,000 new jobs, while the unemployment rate, at 4.2%, stayed in the lowest 10% of readings back to 1948. Plus, higher hourly earnings growth should keep consumers spending and the economy growing. The week ended with the Dow UP 1.2%, to 42,763; the S&P 500 UP 1.5%, to 6,000; and the Nasdaq UP 2.2%, to 19.530. Bonds overall dipped a smidge, though the 30-Year UMBS 5.5% went UP 0.74, to 99.01. In Freddie Mac’s weekly survey, the national average 30-year fixed mortgage rate decreased—“welcome news to potential homebuyers who also are seeing inventory improve and house price growth slow.” Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information. DID YOU KNOW… A new survey revealed a growing number of millennials are planning to buy a home—and soon. In April, 23% of millennial respondents said they intend to buy in the next six months, up from 15% last September. |
| MORTGAGE APPLICATIONS, INFLATION, CONSUMER SENTIMENT… We’ll check the MBA Mortgage Applications Index to see whether purchase applications keep coming in ahead of last year. Economists expect inflation to continue to moderate in May, as measured by the Consumer Price Index (CPI). They’re also forecasting that the preliminary June read for University of Michigan Consumer Sentiment will head northward, a welcome sign for the economy. |
| Forecasting Federal Reserve policy changes in coming months. The strength of the labor market in May left futures traders expecting the Fed will not make their first rate cut until the fall. Note: In the lower chart, the 0.1% probability of change is a 99.9% probability the rate will stay the same. Current rate is 4.25%-4.50%. AFTER FOMC MEETING ON: CONSENSUS Jun 18 4.25%-4.50% Jul 30 4.25%-4.50% Sep 17 4.00%-4.25% Probability of change from current policy: AFTER FOMC MEETING ON: CONSENSUS Jun 18 0.1% Jul 30 14.5% Sep 17 63.0% |
| Give yourself positive inputs every day and maintain a vision of the best version of yourself—what you and your clients deserve. Confidence, resilience, and an unwavering belief in your value should be non-negotiable. |
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.
