New Data Shows a Sharp Decrease In Demand Driving Housing Market Cooldown Private Sector Adds 208,000 Jobs Home Price Appreciation Lose Steam

Sharp Decrease In Demand Driving Housing Market Cooldown

HouseCanary Inc., a nationwide brokerage renowned for the accuracy of its real estate valuations, published its most recent Market Pulse report on Wednesday. It covered 22 measures obtained from listings and compared data between September 2021 and September 2022. According to their new survey, the number of homes being taken off the market and price reductions has dramatically increased as mortgage rates climb.

The ongoing lack of housing inventory over the past year has been mostly caused by frequent interest rate increases by the Federal Reserve to combat escalating inflation. Due to the record-high mortgage rates, the post-pandemic housing market has undergone a dramatic turnaround, according to HouseCanary.

As per Jeremy Sicklick, HouseCanary co-founder and CEO, the significant increases in listing removals and price drops are driven by declining demand.

A net of 3,179,129 new listings has been added to the market since September 2021, a 7.6% reduction from the preceding 52 weeks. Monthly new listing volume decreased by 19.2% compared to last year.

Over the last 52 weeks, 3,194,231 properties have gone into contract, representing an 11.1% decrease in the same period in 2021.

Home Price Appreciation Losing Steam

Although U.S. home prices resumed their 127-month consistent annual growth in August, they slowed for the fourth consecutive month to 13.5%, according to CoreLogic’s monthly Home Price Index and HPI Forecast. Since April 2021, the slightest yearly appreciation has been observed.

Similar discoveries were published on Monday by Black Knight, Jacksonville, Florida. According to its monthly Property Price Index, the median home price declined by 0.98% in August, slightly better than the monthly decline of 1.05% in July, which had been upwardly revised. The report also shows the months of July and August saw the most significant monthly price drops since January 2009.

As per Selma Hepp, interim head of CoreLogic’s Office of the Chief Economist, the August results partially reflect continued cooling in buyer demand brought on by rising mortgage rates and changing housing trends sparked by the conclusion of the COVID-19 outbreak. With nearly three-quarters of states reporting drops from July, the 0.7% month-over-month price decrease also points to a decline in homebuyer enthusiasm.

ADP: Private Sector Adds 208,000 Jobs; Annual Pay Up 8%

According to ADP, Roseland, New Jersey, the private sector added 208,000 jobs in September, which released the second of four significant jobs reports this week. However, annual pay growth slowed to just under 8 percent.

The ADP National Employment report indicates small businesses (those with 1–49 people) added 58,000 jobs in September, followed by medium-sized businesses (those with 50–499 employees), which added 90,000 jobs, and big enterprises, which added 60,000 jobs. According to the data, employers in the service sector created 237,000 new positions in December, while companies that manufacture goods lost 29,000 jobs overall.

“There are signs that people are returning to the labor market,” said Nela Richardson, chief economist with ADP. “We’re in an interim period where we’re going to continue to see steady job gains. Employer demand remains robust, and the supply of workers is improving–for now.”

According to the survey, job changers’ pay declined in September after experiencing double-digit year-over-year improvements since the summer of 2021. The worst slowdown in the three-year history of ADP data occurred in their annual salary, which increased by 15.7 percent instead of the revised 16.2 percent advance in August. In September, the yearly salary increase for those who kept their jobs was 7.8%, up from a revised 7.7% in August.

Humor of the Week:

What is a mortgage officer’s favorite Mexican food?

Refied beans

Next week’s potential market-moving reports are:
Monday, October 10th – No Report
Tuesday, October 11th – NY Fed 5-year Inflation Expectations
Wednesday, October 12th – FOMC Minutes
Thursday, October 13th – Cofre CPI, Initial Jobless Claims, Continuing Jobless Claims
Friday, October 14th – Retail Sales, UMich Consumer Sentiment Index

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 feel free to reach me at (800) 216-1047.

Resource:-

https://finance.yahoo.com/news/sharp-decrease-demand-driving-housing-130000580.html

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The Current State of Refinancing Inflation, Home Price Growth Headed Downward: Fed Report but based on the Bureau of Labor Statistics, Inflation Rose 0.1% In August Even with Sharp Drop In Gas Prices

  • 17 Sep 2022
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Inflation, Home Price Growth Headed Downward: Fed Report

According to the most recent Survey of Consumer Expectations (SCE) from the Federal Reserve inflation is predicted to continue “to decline across all horizons” over the coming year while home price growth is also predicted to decline “sharply” to the lowest level since July 2020.

The August SCE survey reports that the median one-year inflation outlook decreased from 6.2% in July to 5.7%. The median estimate for home price growth decreased by 1.4 percentage points from July to August, falling to 2.1%, the lowest SCE reading since July 2020.

Even so, he ome prices during thyear’s second quarter hit a high peak, despite the gloomy predictions for the housing market as we approach the third quarter of 2022. According to the Federal Reserve Bank of St. Louis, average home prices increased dramatically in the second quarter of this year, rising to $525,000 from $440,600 for the same time in 2021. According to the research, the median sales price in the second quarter of this year was $440,300, up from the second quarter of last year’s median sales price of $382,600.

Inflation Rose 0.1% In August Even with Sharp Drop In Gas Prices

Based on the Bureau of Labor Statistics, inflation increased more than anticipated in August as rising housing and food prices partially offset a decline in gas prices.

The consumer price index, which measures the cost of a wide range of goods and services, rose 0.1% in the month and 8.3% in the previous 12 months. When volatile prices for food and energy were excluded, the CPI increased 0.6% from July and 6.3% in the same month in 2021.

For the month,energy costs decreased by 5%, with the gasoline index falling by 10.6%. However, other increases more than countered those reductions.

In August, the food index rose by 0.8%, while the cost of housing, which accounts for nearly one-third of the CPI’s weighting, increased by 0.7% and is now up 6.2% from a year earlier.

Medical care services also experienced significant growth, increasing by 5.6% from August 2021 and 0.8% monthly. Prices for new cars increased by 0.8%, while those for used vehicles decreased by 0.1%.

Following the news, the stock market had its worst single trading day since June 2020. The market dropped almost 1,300 points in the session.

The August data also contained some positive news for employees, with real average hourly wages increasing by a seasonally adjusted 0.2% for the month. They were still 2.8% lower than they were a year earlier.

The Federal Reserve has increased interest rates four times this year for a total increase of 2.25 percentage points to fight the overall rise in the cost of living. The central bank wants to control inflation without wrecking the economy; therefore, Tuesday’s report is anticipated to have more impact through the remainder of the year and into 2023 than on the September meeting.

The Current State of Refinancing

“Higher mortgage rates have pushed refinance activity down more than 80 percent from last year and have contributed to more home buyers staying on the sidelines. Government loans, which tend to be favored by first-time buyers, bucked this trend and increased over the week, driven mainly by VA and USDA lending activity.” –Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting.

Next week’s potential market-moving reports are:

  • Monday, September 19 – NAHB Home Builders’ Index
  • Tuesday, September 20 – Building Permits, Housing Starts
  • Wednesday, September 21 – Existing Home Sales, Federal Reserve Statement
  • Thursday, September 22 – Initial Jobless Claims, Construction Spending,
  • Friday, September 23 – No Report

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 feel free to reach me at (800) 216-1047.

California Platinum Loans

  https://californiaplatinumloans.com

Redfin Reports Homebuying Competition Drops Near Pandemic-Era Low Zillow says Buyers Gaining Time, Options as Housing Market Rebalances

Homebuying Competition Drops Near Pandemic-Era Low, Redfin Reports

According to recent data from Redfin, competition for home purchases continues to decline as affordability challenges keep many buyers out of the market.

The number of prospective purchasers to make counteroffers is declining, confirming the softening in the market. Counteroffers accounted for only 44.3% of offers made by Redfin agents in July on a seasonally adjusted basis. This represents a decrease from 63.8% from the same time a year ago. This is also lower than last month’s 50.9% for June 2022. This is the sixth consecutive month where multiple-offer scenarios have fallen.

The percentage of offers countered in July was the second-lowest rate the national real estate brokerage had ever seen during the COVID-19 pandemic. The only month with a smaller share was April 2020, when the virus’s appearance brought the housing market to an abrupt halt.

“There’s not the same sense of urgency,” said Alexis Malin, a Redfin real estate agent in Jacksonville. “House hunters are scheduling tours four days in advance instead of one, and they’re becoming much more selective. If a home doesn’t check all of their boxes, they’re waiting until they find one that does. Six months ago, buyers were taking any house they could get.”

Scales have started to tip in favor of buyers as properties begin to stay on the market for extended periods. Even though there is still a long way to go until a buyer’s market is officially proclaimed, some sellers have begun to lower their prices to spur demand. Price reductions occur on 8% of market listings weekly, which is a record-high number.

Zillow: Buyers Gaining Time, Options as Housing Market Rebalances

As per Zillow’s most recent market analysis, property values decreased marginally from June to July, following two years of unmatched increase.

The market is thus swiftly rebalancing, according to Skylar Olsen, chief economist at Zillow. Competition for homes is dwindling due to purchasers’ purchasing power being lowered by nearly two years of double-digit price rises and increased mortgage rates.

Zillow further reports that the average U.S. home value dropped by 0.1% ($366) month over month in July and is now $357,107. Since recently peaking at 1.9% in April, monthly growth in this statistic has slowed, declining to 1.2% in May and 0.8% in June. Although a slowdown in home price increase at this time of year is expected, this is the first monthly drop since 2012. The mean home value nationwide has increased by 16% over the past year and 44.5% since July 2019.

In 30 of the 50 largest metro areas, home values as assessed by raw ZHVI decreased from June to July.

Next week’s potential market moving reports are:

  • Monday, August 29th – No Report
  • Tuesday, August 30th – U.S. Home Price Index, Job Openings, Quits
  • Wednesday, August 31st – Cleveland and Atlanta Fed Presidents Speak
  • Thursday, September 1st – Initial Jobless Claims, Construction Spending
  • Friday, September 2nd – Unemployment Rate, Average Hourly Earnings

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 feel free to reach me at (800) 216-1047.

California Platinum Loans

  https://californiaplatinumloans.com