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Residential Mortgage Loan Originator
921 Chatham Lane STE 101
Columbus, OH 43221
|For the week of May16, 2016 – Vol. 14, Issue 20|
>> Market Update
QUOTE OF THE WEEK… “The way to get started is to quit talking and begin doing.” –Walt Disney, American entrepreneur and animation pioneer
INFO THAT HITS US WHERE WE LIVE … There’s always lots to talk about in the housing market, but happily what more people have begun doing is actually buying homes. The National Association of Realtors (NAR) reported existing home sales saw their best first quarter in almost a decade. The NAR chief economist painted this picture: “In spite of deficient supply levels, stock market volatility and the paltry economic growth seen so far this year, the housing market did show resilience and had its best first quarter of existing sales since 2007.” For single-family homes and condos, that was a 5.29 million unit annual rate–4.8% higher than a year ago.
Seeing this excellent Q1 performance, an NAR economic forecast forum predicted existing home sales would post their best year in the last ten, finishing 2016 at a 5.40 million annual pace. They expect median existing home price gains to moderate from 6.8% in 2015 to 4% to 5% this year. A major real estate information firm’s report on Q1 loan originations showed purchase mortgages up 3% and home equity lines of credit up 10%, versus a year ago. Oddly in this low rate environment, refinance originations dropped, but the firm’s senior VP pointed out, “the purchase loan market continued the pattern of slow-and-steady growth that it has been following the past two years.”
BUSINESS TIP OF THE WEEK… In every endeavor, always choose to succeed. People are successful for many different reasons, but they all share this one: they chose to succeed.
>> Review of Last Week
LOSING STEAM... This morning, you have to give a nod to those who say the bull market is cooling off. We’ve now had three losing weeks in a row for the blue-chip Dow and the broadly based S&P 500, while the tech-heavy Nasdaq has given us four down weeks. Traders saw another batch of first quarter corporate earnings, and with 92% of the S&P 500 companies reporting, earnings are down 7.6% year-over-year. Investors were also worried about crude oil prices moving lower and Chinese banks pulling back on lending. But those clouds had a silver lining: Fed Governor Lael Brainard indicated the “challenging” global environment keeps her from voting for a rate hike. Yes!
The week ended with the Dow down 1.1%, to 17540; the S&P 500 down 0.5%, to 2047; and the Nasdaq down 0.4%, to 4719.
The week’s stock rout sent investor money to the safe haven of bonds. The 30YR FNMA 4.0% bond we watch finished the week UP .02, at $106.91. In Freddie Mac’s Primary Mortgage Market Survey for the week ending May 12, national average 30-year fixed mortgage rates fell for the third week in a row, to their low point for the year. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
>> This Week’s Forecast
HOUSING STARTS, EXISTING HOME SALES, INFLATION UP, FED MINUTES REVEALED… This week’s economic reports are expected to show two major components of the housing market moving in the proper direction. Housing Starts and Existing Home Sales should show gains for April. But inflation is forecast to be up too, as measured by the Consumer Price Index (CPI) and Core CPI, which takes out volatile food and energy prices. Wednesday‘s release of FOMC Minutes from the Fed’s last meet will have pundits prognosticating when we’ll see the next rate hike. As if anybody knows.
>> The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Economic Calendar for the Week of May 16 – May 20
>> Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months… There may be more yak in the media about a June rate hike, but most economists don’t see the Fed touching rates through September. Note: In the lower chart, a 4% probability of change is a 96% certainty the rate will stay the same.
Current Fed Funds Rate: 0.25%-0.5%
Probability of change from current policy:
|This e-mail is an advertisement for Scott Voelkel. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice, or a commitment to lend. Although the material is deemed to be accurate and reliable, there is no guarantee of its accuracy. The material contained in this message is the property of Premier Nationwide Lending and cannot be reproduced for any use without prior written consent. This message is intended for business professionals only and is not intended for distribution to consumers or other third parties. The material does not represent the opinion of Premier Nationwide Lending. Programs, rates, terms and conditions subject to change without notice. All financing subject to credit and income approval. This is not a commitment to lend. Rates can change daily. Other restrictions may apply. Premier Nationwide Lending is an equal housing lender. Sponsored by NTFN, Inc. 700 State Highway 121 Bypass, Suite 100, Lewisville, TX 75067 NTFN NMLS 75333.|
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Diana Barnum REALTOR®, e-PRO®, BPOR
Best Homes Real Estate, LTD
Direct: (614) 314-4960 mobile / text