|For the Week Ending December 15, 2017|
The FOMC Meeting:
As expected, the Federal Open Market Committee voted to raise the Fed Funds Rate by 25 basis points, bringing the rate to a range of 1.25 to 1.50 percent. The board members voted 7-2 in favor of the interest rate
The Stock Market:
The stock market met the Fed announcement with little more than a yawn. There was nothing in the Fed message that was a surprise. For the last few months, the majority of investors and analysts have been expecting
Mortgage Rates and Loan Activity:
Until this week, mortgage rates have been inching higher. The Mortgage Bankers Association reported for the week ending December 8th, applications for purchases declined 1.0 percent, and refinances dropped 3.0 percent.
In what was a little bit of a surprise, bonds rallied after the Fed announcement on Wednesday of this week. The 10 Year Bond yield, which is a representation of mortgage rate movement, but not the basis for them,
The stock market declined on Thursday as did bond yields as investors placed more money into the bond market after digesting the Fed’s announcement. There is some investor sentiment that now exists in that the Fed’s
There is growing concern in regard to the future of the housing market. With all of the talk on the proposed tax reform and the lowering of the real estate tax deduction limit, concerns exist on how this could impact,
Next week’s potential market moving reports are:
• Monday December 18th – Housing Market Index
As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends. I welcome the opportunity to serve you in any way I possibly can.
Please enjoy this quick update on what happened this week in the housing and financial markets.
|Tax reform is moving forward. Lawmakers are currently reconciling the Senate and House versions. The GOP is trying to get it done before 2018.|
|The Fed raised policy rates at this week’s meeting, as expected. The rate increase actually helps to keep mortgage rates low for the near term.|
|The Fed is expected to raise rates 3 times in 2018, based on current forecasts. The policy rate increases could pressure mortgage rates higher for next year.|
|Homebuilders that focus on entry-level housing are expected to flourish in 2018. A growing economy, solid job market, and low mortgage rates are driving demand.|
|In its 2018 forecast, Realtor.com predicts home prices will go up 3.2% and sales will increase 2.5%. Inventory is also expected to rise.|
|Mortgage rates remain low, and mortgage applications remain high. New purchase apps were 10% higher than a year ago this time.|
Sister: “What are you giving Mom and Dad for Christmas?”
Brother: “A list of everything I want!”
Rate movements and volatility are based on published, aggregate national averages and measured from the previous to the most recent midweek daily reporting period. These
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