Since many on this site may be buying or selling a home at any given time, own investment properties, or commercial real estate I'm posting this weekly update to stay current.
The data is well researched from multiple sources concerning the real estate & mortgage market.
Thus, it is fact based and only analyzing the data/trends without regard to government policy.
As I stated previously let's keep the thread informational for those that might be in the market and leave policy discussions in "The Corral".
Quick Glance on Rates -
Rising 10 Year-Treasury Rates Are Dragging Mortgage Rates Higher
Although rate cuts by the Federal Reserve often lower short-term borrowing costs, mortgage rates are more closely linked to long-term factors such as the 10-year Treasury yield, which can rise even when the Fed cuts rates.
Mortgage rates tend to follow the movement of these yields because they are influenced by broader economic trends, such as inflation expectations, job growth, and investor behavior. Recent strong job reports have pushed Treasury yields higher, which, in turn, has kept mortgage rates elevated despite Fed cuts.
Additionally, the housing supply shortage remains a significant factor. Powell has been very clear about this. With demand still high and the inventory of homes limited, banks have less incentive to lower mortgage rates. Lenders also account for risk premiums, which will further widen the gap between the prime rate and mortgage rates.
Fed cuts will lower the prime lending rate, however market conditions such as the bond market and housing supply dynamics are playing a more dominant role in keeping mortgage rates high.
3 Year overlay of the 10y Treasury Note.
Credit @arxsanctus
Unfortunately It's Not the Only Thing They're Dragging Higher - Interest On The Debt Hits "All Time High"
If the FED tries to inflate it's way out of our National Debt, then housing prices, which are already unaffordable for many, would rise even more.
You can see the threat of this strategy as the Gold Market just hit an "All-Time High". Gold and real estate have historically been a hedge against inflation.
Housing Improving For Buyers -
Main Points -
The combination of historically low home affordability and low housing inventory has been a tough hurdle recently for many would-be homebuyers to overcome. Thankfully, both of those appear to be working their way back to normalization.
While we wait to see exactly how mortgage rates and their ability to improve affordability for homebuyers will play out, one source of positive momentum has been the thawing of for-sale inventory.
According to the most recent Zillow data, September saw for-sale inventory levels, or the count of unique listings that were active at any time in the month, rise to 1.18 million units. That represents a 21.6% increase from the prior year. To put things into better context, this meant that there were 3.51 homes for sale per 1,000 people, which equates to levels not seen since 2020.
If there were a “not so fast” call out, it would be that the levels are still just 70.9% of September 2019 readings, and it does appear that August has typically been the seasonal turning point for when inventory levels start to contract.
Among The Largest Markets with For-Sale Inventory Surpassing September 2019 Levels -
Best Football Real Estate Related Post of The Week - LMAO!!!!
Always here ITT to answer questions on Real Estate or Mortgage - Shoot me a DM as well.
Have an Amazing Weekend as The ATX will be the Epicenter of the world for the next 72 hours!
Beat the Hell Out of Georgia!
Hook 'Em!
MH
The data is well researched from multiple sources concerning the real estate & mortgage market.
Thus, it is fact based and only analyzing the data/trends without regard to government policy.
As I stated previously let's keep the thread informational for those that might be in the market and leave policy discussions in "The Corral".
Quick Glance on Rates -
Rising 10 Year-Treasury Rates Are Dragging Mortgage Rates Higher
Although rate cuts by the Federal Reserve often lower short-term borrowing costs, mortgage rates are more closely linked to long-term factors such as the 10-year Treasury yield, which can rise even when the Fed cuts rates.
Mortgage rates tend to follow the movement of these yields because they are influenced by broader economic trends, such as inflation expectations, job growth, and investor behavior. Recent strong job reports have pushed Treasury yields higher, which, in turn, has kept mortgage rates elevated despite Fed cuts.
Additionally, the housing supply shortage remains a significant factor. Powell has been very clear about this. With demand still high and the inventory of homes limited, banks have less incentive to lower mortgage rates. Lenders also account for risk premiums, which will further widen the gap between the prime rate and mortgage rates.
Fed cuts will lower the prime lending rate, however market conditions such as the bond market and housing supply dynamics are playing a more dominant role in keeping mortgage rates high.
3 Year overlay of the 10y Treasury Note.
Credit @arxsanctus
Unfortunately It's Not the Only Thing They're Dragging Higher - Interest On The Debt Hits "All Time High"
If the FED tries to inflate it's way out of our National Debt, then housing prices, which are already unaffordable for many, would rise even more.
You can see the threat of this strategy as the Gold Market just hit an "All-Time High". Gold and real estate have historically been a hedge against inflation.
Housing Improving For Buyers -
Main Points -
- For-sale housing inventory rose to 1.18 million in September, up 21.6% year-over-year, but the monthly growth rate has fallen for four consecutive months as we head into the traditional seasonal slowdown.
- On a per capita or per 1,000 people basis, for-sale inventory levels sit at 3.51, just 70.9% of 4.94 mark of September 2019 which is considered a “normal” market, pre-pandemic.
- Mean days to pending and the percent of homes sold below list price continues its seasonal upswing. However, the current readings of 46 mean days to pending and 50% of homes sold below list price are the highest we have observed for any month of September since 2019.
- Housing markets in Florida are experiencing the largest gap between annual supply and demand growth leading to a higher rate of homes being sold below their list price.
- The Northeast and Midwest lag the rest of the country in returning to “normal” inventory levels. Housing inventory levels in these regions of the country continue to remain 50% or more below 2019 levels.
- The divergence in for-sale inventory levels leading to a larger supply and demand gap in Southern housing markets relative to Northeast/Midwest housing markets is a key contributing factor for why sellers in the South are seeing their homes take longer to find a buyer and causing more sellers to cut prices to get a buyer under contract.
The combination of historically low home affordability and low housing inventory has been a tough hurdle recently for many would-be homebuyers to overcome. Thankfully, both of those appear to be working their way back to normalization.
While we wait to see exactly how mortgage rates and their ability to improve affordability for homebuyers will play out, one source of positive momentum has been the thawing of for-sale inventory.
According to the most recent Zillow data, September saw for-sale inventory levels, or the count of unique listings that were active at any time in the month, rise to 1.18 million units. That represents a 21.6% increase from the prior year. To put things into better context, this meant that there were 3.51 homes for sale per 1,000 people, which equates to levels not seen since 2020.
If there were a “not so fast” call out, it would be that the levels are still just 70.9% of September 2019 readings, and it does appear that August has typically been the seasonal turning point for when inventory levels start to contract.
Among The Largest Markets with For-Sale Inventory Surpassing September 2019 Levels -
- Cape Coral, FL = 132.0%
- Austin, TX = 114.0%
- New Orleans, LA = 125.8%
- Lakeland, FL = 114.6%
- Crestview, FL = 112.8%
1. Miami, FL = 75.7%
2. Dallas, TX = 74.6%
3. Houston, TX = 74.0%
4. Atlanta, GA = 68.6%
5. Tampa, FL = 90.2%
Best Football Real Estate Related Post of The Week - LMAO!!!!
Always here ITT to answer questions on Real Estate or Mortgage - Shoot me a DM as well.
Have an Amazing Weekend as The ATX will be the Epicenter of the world for the next 72 hours!
Beat the Hell Out of Georgia!
Hook 'Em!
MH
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