I hope everyone enjoyed their holidays and got to spend time with friends and family. Your gift from the government was a shutdown.
This week’s a little slower because of the holidays. But, we did get some housing data. Let’s dive in!
S&P CoreLogic Case-Shiller HPI
Home prices in October were up 0.4% on a seasonally-adjusted basis as expected. Prices were flat overall on the month. Home prices have gone up 5% for the year.
The Northeast is hot with Boston and New York both seeing home prices rise 0.7% on the month. The West is starting to cool. Seattle was down 0.3%, while Portland and Denver were up 0.2% on the month, exhibiting slower growth.
Las Vegas was up 0.8% on the month and has risen 12.8% on the year, while San Francisco is a 7.9% annually. Washington and New York City trail, up 2.9% and 3.1% respectively.
Monthly revisions were mixed with the index showing up 0.7% in October and down 0.2% in August.
FHFA House Price Index
The Federal Housing Finance Agency saw a gain in home prices of 0.3% for a 5.7% year-on-year rate. However, this is still a 2-1/2 year low.
Prices in the Mountain region are still reporting strong at a nearly double-digit yearly gain, while prices in New England, the Mid-Atlantic and the West South Central had weak reports where appreciation is in the low- to mid-single digits.
New Home Sales
With the continuing federal government shutdown, there wasn’t much in this report. While rates were weak in October, November has had a bounce back to 560,000 in new home sales.
Initial jobless claims were down 1,000 to 216,000 last week. This brought the four-week average down to 4,750 to 218,000, down for the third straight week.
Continuing-unemployment claims were down 4,000 to 1.676 million, while the 4-week moving average was down to 1.676 million.
Consumer confidence fell 8.3 points to come in at 128.1 in December. While the points continue to show the lowest numbers since July, it’s good news for jobless claims as December shows strength in the employment rate.
Taking a look at current conditions, 1% fewer consumers see jobs as hard to get, bringing the total to 11.6%. Consumers who expect more jobs in the months ahead decreased to 16.6%.
Inflation expectations were down to a 4.3% level, which is low for this report. There are also reports of the Federal Reserve policymakers planning a couple more rate hikes in the coming year to stem the risk of inflation.
Similar to new home sales, there wasn’t much of a report with international trade, but the U.S. trade deficit decreased to $75.7 billion from $77 billion in October. There was a 0.6% downturn in exports and a 0.1% rise in imports.
Pending Home Sales
Homes with a purchase agreement in place for sale was down 0.7% to an index level of 101.4 in the month of November.
Looking at regional data, pending sales were weakest in both the South and Midwest balancing out the slight gain in the Northeast and West.
As of this writing, the federal government remains shut down. Since our last Market Update, there doesn’t seem to be any changes regarding FHA, USDA or VA loan applications, although Quicken Loans will continue to accept these loan applications.
We’ll continue to keep you posted, but if you have any immediate questions, you can contact our team at (800) 863-4332.
Ending the year on a high note, mortgage rates dropped last week, making it as good a time as any to lock your interest rate if you’re in the market to purchase or refinance.
The average rate for a 30-year fixed mortgage with 0.5 points paid in fees was down to 4.55%. This is up from 3.99% at the same time a year ago.
In shorter terms, the average rate for a 15-year fixed mortgage was 4.01% with 0.4 points paid. This is a slight change from last week and up from 3.44% last year.
Finally, the average rate on a 5-year treasury-indexed adjustable rate mortgage (ARM) with 0.3 points was 4%. This has risen from 3.47% at this time in 2017.
Things are looking up for the stock market, as the Dow Jones Industrial Average rose 250 points. The S&P 500 also had a good day and gained 0.9%. The Nasdaq continues to rise from last week at 1.1%.
While the optimism surrounding the U.S.-China trade is to credit for the higher numbers, they were still down at least 4.8% year to date through Friday’s close, their worst annual performance since 2008. However, there are talks of future climbs in stocks in 2019.
Our Fantasy Stock League will end with the close of today’s stock trading. We hope you learned more about investing in the stock market, and more importantly, we hope it’s been fun for you to see how you would do. We’ll announce the grand prize winner in the coming weeks, so stay tuned for updates on the Fantasy Stock League home page.
The Dow is up 248.86 points today, to close at 23,311.26, up 1.08% on the week. The S&P 500 closed at 2,505.00, up 0.77% on the week and 19.26 points on the day. Finally, the Nasdaq rose 1.02% on the week to close at 6,651.87, up 67.35 points on the day.
The Week Ahead
Tuesday, January 1
Ring in the new year! Quicken Loans is closed in observance of New Year’s Day along with the stock and bond markets, as well as banks. Be safe, everyone!
Thursday, January 3
MBA Mortgage Applications (7:00 a.m. ET) – The mortgage applications index measures applications to mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
Jobless Claims (8:30 a.m. ET) – New unemployment claims are compiled weekly to show the number of individuals filing for unemployment insurance for the first time. An increasing trend suggests a deteriorating labor market. The four-week moving average of new claims smooths out weekly volatility.
ISM Manufacturing Index (10:00 a.m.) – This index measures the general direction of manufacturing within the U.S. The qualitative survey of purchasing managers looks at production, new orders, order backlogs, inventories and supplier deliveries, among other factors.
Friday, January 4
Employment Situation (8:30 a.m. ET) – The employment situation report measures unemployment in the labor force as well as the sentiments of workers about the job market.
The New Year is a time to make resolutions, so if you’re in the market to purchase or refinance your home, now remains a good time to do so. If you’re not ready to make the leap into homeownership, there’s still plenty of home, money and lifestyle content to enjoy by subscribing to the Zing Blog. If you’re planning a last-minute New Year’s Eve party tonight, check out our guide for everything you need to throw an end-of-the-year bash. Have a great week, and Happy New Year!
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