Market update

QUOTE OF THE WEEK… “People are looking for something a little more stable.” –Dolly Parton, American singer-songwriter and actress.

INFO THAT HITS US WHERE WE LIVE… A major real estate tech and data firm reports that stability, in fact, is returning to the housing market. This does come with a slowdown in home price gains, but that’s not necessarily a bad thing. The firm’s chief economist explains, “Continued moderation of home price appreciation is a welcomed sign of more balanced real estate markets and less pressure on affordability for potential home buyers.” This slowdown in home price growth also reflects a welcome rise in supply. More homeowners are willing to list their properties and homebuilders are bringing more new homes to the market. And, hey, even with the slowdown, prices are still up more than 7% year-over-year. A stabilizing housing market is clearly more attractive to consumers. Fannie Mae’s latest housing market survey reveals an encouraging change in attitudes: “In September, the share of consumers who say now is a good time to buy a home is back up to 68%, a four-percentage-point increase from August. Additionally, the share saying they would prefer to buy a home on their next move ticked back up to 66% after a three-point drop.” And if you’re looking to corroborate these findings in real-world results, the Mortgage Bankers Association reported their purchase applications index up 2% for the week ending October 3. This put it at its highest level since early July. BUSINESS TIP OF THE WEEK…Stop worrying about things you have no control over. This only destroys your focus, making it harder to reach your goals.

>> Review of Last Week

DOWN!… Friday, the main stock market benchmarks ended decidedly down, posting their deepest weekly dips in more than two years. The trend started on Tuesday with a 273 point drop in the Dow. But Wednesday saw the index gain all of it back, as Wall Street digested the FOMC Minutes from the Fed’s last meeting. The good news was, the central bank is in no hurry to raise rates. They fear a European downturn, which is bad news that’s actually good news for rates. Thursday, investors decided the bad news really was bad news, since U.S. companies need healthy European economies to buy our goods and services. Stocks dropped 335 points. The global theme continued with minutes from the Bank of Japan showing their central bankers are worried over a weakness in exports. Further evidence of slowing global growth came with a slip in China’s HSBC Services PMI, although it did stay above 50, indicating expansion in their services sector. The down vibe got precious little help from U.S. economic data, which was light on the ground. There was a small drop in import prices, which dipped for the third straight month, another sign inflation stays quiet. The best news was that initial weekly jobless claims are under 300,000 and the 4-week moving average is at its lowest level since 2006. The week ended with the Dow down 2.7%, to 16544; the S&P 500 down 3.1%, to 1906; and the Nasdaq down 4.5%, to 4276.Stocks sank, but bonds gained, as investors sought a safe haven for their money amidst global economic concerns. The 30YR FNMA 4.0% bond we watch finished the week up .05, to $105.30. In Freddie Mac’s Primary Mortgage Market Survey for the week ended October 9, national average fixed mortgage rates fell back near their lows for the year. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up to the minute information.  DID YOU KNOW?… A national real estate information company reports that nearly 10 million homeowners, representing 19% of all homeowners with a mortgage, now have at least 50% equity in their homes.

>> This Week’s Forecast

MIXED SIGNALS FOR RETAIL SALES AND MANUFACTURING, HOUSING STARTS GAIN… Although overall Retail Sales are forecast off for September, if you exclude auto sales, they should be up a tick. The theme of mixed signals continues with manufacturing. The New York Empire and Philly Fed Indexes are predicted to show growth slowing in those regions, but Industrial Production and Capacity Utilization are expected to gain a bit nationally. Both Housing Starts and Building Permits should break through the million unit per year threshold, as home builders appear to remain optimistic. Monday, Columbus Day, the stock market is open but the bond market is closed.

Information provided by Laurie Moore of Wallick & Volk Mortgage

Laurie A Moore Sr. Mortgage Consultant & Certified Mortgage Planner NMLS #256449 2086 Willow Creek Road Prescott, AZ 86301 Office: 928-778-7167 Mobile: 928-308-1723 Fax: 928-445-5308

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