The jobs market showed signs of slowing last week, which is good news for rates. This week, we’ll see inflation data. We’re helping buyers negotiate seller-paid buydowns to lower their rates by as much as 3% in the first year.
| What You Need to Know |
Data Check: Applications: Applications down 2.6% this week, reversing a 3 week trend higher. (MBA) Inventory: 652K homes on the market. Up 1% last week and 28% from last year. Inventory continues to grow. (Altos) Price reductions: Up to 37.5% of active inventory. Up another 0.6% last week. (Altos) Rates: Rates remain around 7%. (Mortgage News Daily) We continue to see local markets diverge in terms of supply and demand. For Buyers: We are nearing the seasonal tipping point for inventory and new listings. If rates drop, many markets will get very competitive. Now is a great time to buy. For Sellers: New listing growth is slowing, but inventory remains above last year. That’s why we’re seeing price reductions climbing earlier than usual. Rates aren’t dropping fast enough to significantly increase demand. For Investors: “52.3 million of the 134 million U.S. families reside in housing they don’t own. Among those renter/non-homeowner households, only 7.9 million, or 15.1%, can afford to buy an average-priced home in their local market given current mortgage rates.” This is good news for Single Family investors. (@LanceLambert Resiclub graphic below) Ask us about our Market Spotlight presentation. Each week, we assemble a series of graphics and charts you can use to help your Buyers, Sellers, and Investors make informed real estate decisions. |
| Financial Market Update |
Economy Shows Signs of Slowing Down The jobs report last week was favorable for rates. Nonfarm payrolls increased by 206,000 more than expected, while the unemployment rate climbed to 4.1%, the highest since October 2021. Rates dropped slightly on the news. More importantly, the last few months were revised down, and the underlying data shows that the labor market is softening, which is potentially great news for interest rates. This week is another big one for rates. We have the Consumer Price Index on Thursday and the Producer Price Index on Friday. This data will give us a better view of inflation, and favorable results could lead to lower rates. The key to the next few months is helping buyers take advantage of small moves down and increased leverage. |
