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Inflation is low and prices are high in this week’s Markets in a Minute!

Inflation is low and prices are high in this week’s Markets in a Minute!
June 23, 2017 Fred Kreger

 

 

For the Week Ending June 23, 2017

After recent reports on housing that have been less than stellar, this week’s reports show that the tide may be turning. From home prices, to existing sales, to loan applications for purchases, things seem to be
improving.

 

May’s existing homes sales report showed a very solid increase of 1.1 percent. This is a complete turnaround from the prior months decline of 2.5 percent. Single-family sales increased by 1.0 percent to an annual
rate of 4.980 million. Condo sales also increased by 1.6 percent to a 640,000 rate.

 

Another positive in the housing report is the significant increase in supply. With prices moving higher, more homes are coming into the market. As I mentioned last week, homeowners are finally recognizing the increase
in their home value creating the desire to cash out by selling. Inventory increased from 1.960 million from 1.920 million in April and 1.800 million in March. Sales have been increasing each month as well which reinforces the fact that there is a ton of pent
up demand.

 

The West remains super-hot with sales up by 3.4 percent for the month of May. They are also higher by 3.4 percent from the same time last year. The South had the second strongest increase by percentage with an rise
of 2.2 percent for the month. The region is higher than the same time last year by 4.5 percent. The Northeast, which had been lagging, is showing life for the first time in a long time with sales up 6.8 percent. The Midwest continues to struggle with being
the only negative sales market with a decline of 5.9 percent.

Although the year started out strong but then mostly slowed during the Spring selling season, life seems to be returning to the housing market now. As mentioned a couple of weeks ago, there are some experts talking
about the late summer and fall real estate market being far stronger than normal.

 

Home prices also jumped according the Federal Housing Finance Agency. April home prices rose 0.7 percent. March was also revised upward to reflect a 0.7 percent increase. The year-on-year rate is up 4 tenths to 6.8
percent which is the best showing in 3 years.

The Mountain region continues to be the strongest market with home prices being 8.9 percent higher than the same time last year. The South is the second strongest market for home values rising with an increase of
8.0 percent. The Pacific, which has always seemed to be leading the way, dropped into 3rd place with a still very respectable increase of 7.5 percent.

 

Next week’s potential market moving reports are:

• Monday June 26th – Durable Goods Orders
• Tuesday June 27th – Case-Shiller HPI, Consumer Confidence
• Wednesday June 28th – MBA Mortgage Applications, Pending Home Sales
• Thursday June 29th – First Time Jobless Claims, GDP
• Friday June 30th – Personal Income and Outlays

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.

 

 

Crude oil prices have plummeted this week, which helps to curb inflation concerns. A lack of inflation helps keep mortgage rates low.
Although the economic outlook continues to improve, consumers are showing signs of declining confidence in their personal finances and may spend less.
Jobless claims were up slightly this week, hitting 241,000. In a sign of labor market strength though, this is the 120th week claims were below 300,000.

 

Nationwide, properties stayed on the market for a median of just 27 days in May. This was the shortest timeframe since NAR began tracking the data in 2011.
Existing home sales rose 1.1% month-over-month in May to 5.62 million. Existing home sales are now 2.7% higher than a year ago.
Inventory shortages continue to push home prices to new highs. The median existing home price was $252,800 in May, passing last June’s peak of $247,600.

The older generation’s dream was to pay off the mortgage. The younger generation’s dream is to qualify for one.

 

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
rate trends can differ from our own and are subject to change at any time.

 

Sincerely,
Fred Kreger
American Family Funding
Certified Mortgage Consultant
NLMS # 1850 / 214640 BRE# 01215943 / 01371184
(661) 505-4311
Fred.Kreger@affloans.com
28368 Constellation Road
Suite 398
Santa Clarita, CA
91355

www.fredkreger.com

 

©2017 American Pacific Mortgage Corporation. All information contained herein is for informational purposes only and, while every effort has been made to insure accuracy, no guarantee is expressed or implied. Any programs shown
do not demonstrate all options or pricing structures. Rates, terms, programs and underwriting policies subject to change without notice. This is not an offer to extend credit or a commitment to lend. All loans subject to underwriting approval. Some products
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