| “Canadians are very well behaved; they don’t throw their food.”—Calvin Trillin, American journalist, humorist, and poet |
| Mortgage applications spiked almost 30% last week, driven by refis, but purchase applications also went up a healthy 12% compared to the prior week and are 20% higher than the same week a year ago. Buyer activity is growing for new homes. The Mortgage Bankers Association noted that in August, “estimated new home sales increased for the third consecutive month to its strongest sales pace in almost a year.” Both Housing Starts and Building Permits dipped in August, as developers focused on completions, up 8.4% over July. And the industry index of builder sentiment in September hit a six-month high for future sales expectations. |
| TWO THUMBS UP… The three major indexes rallied to record highs Thursday after the Fed finally cut rates. They then set new record highs Friday as progress was made in the latest trade talks between China and the U.S. In addition to last week’s cut, the dot plots signaled Fed voters now expect two more rate cuts by year end. Traders still worried about the labor market softening causing these moves, although initial jobless claims fell for the week. Plus, August Retail Sales and Industrial Production pointed to increased consumer spending and manufacturing activity. And the Philadelphia Fed Index surged, signaling stronger regional manufacturing growth. The week ended with the Dow UP 1.0%, to 46,315; the S&P 500 UP 1.2%, to 6,664; and the Nasdaq UP 2.2%, to 22,631. Bonds slipped a tiny bit overall, the 30-Year UMBS 5.0% landing at 99.17. Freddie Mac reported the national average 30-year fixed mortgage rate “decreased yet again,” down another 9 basis points in their 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… DownPaymentResource.com is collaborating with both Realtor.com and Zillow to give buyers access to all the down payment assistance (DPA) programs available for each active MLS listing on those sites. |
| HOME SALES, INFLATION, GDP… Economists expect August New Home Sales to register a gain, but Existing Home Sales to score a small drop. PCE Prices, the Fed’s favorite inflation measure, is forecast to inch up a tad for August, but this week’s GDP-Third Estimate should report that the economy grew in Q2 at a very decent 3.3% annual clip. |
| Forecasting Federal Reserve policy changes in coming months. Now that the Fed has made its first rate cut this year, the futures market expects two more cuts to close out 2025, then a hold in January. Note: In the lower chart, the 91.9% probability of change means there’s only an 8.1% probability the rate will stay the same. Current rate is 4.00%-4.25%. |
| AFTER FOMC MEETING ON: | CONSENSUS |
| Oct 29 | 3.75%-4.00% |
| Dec 10 | 3.50%-3.75% |
| Jan 28 | 3.50%-3.75% |
Probability of change from current policy:
| AFTER FOMC MEETING ON: | CONSENSUS |
| Oct 29 | 91.9% |
| Dec 10 | 80.6% |
| Jan 28 | 46.9% |
| The key to success is to consistently take action. Prospect every day, follow up leads immediately, and keep in touch with present and past clients. You’ll thrive, no matter what. |
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.
