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Will Home Prices Plummet?
This was a BIG story on Realtor.com last week as the story began with existing home sales prices have dropped by $10k since May. However, “We are going to see prices drop as we do seasonally,” said Realtor.com Chief Economist Danielle Hale. Exactly! The story should have stopped there; but it didn’t. Instead they cited…
Will Student Debt Forgiveness Help or Hurt?
According to federal data more than 43 million Americans have federal student debt with about a third owing < $10k and more than half owe < $20k. President Biden announced 3 policies related to student loans. First, he extended the no monthly payment required and the 0% rate until December 31st. Second, borrowers will…
Inflation is Cooling Off
Also, last Friday the Fed’s favorite inflation report the PCE was released and this index dropped by 0.1% in July and year over year inflation dropped from 6.8% to 6.3%. The Core PCE rose by 0.1% and core prices are up 4.6% from last year. Within this same report we see that personal income only…
Is ”Pain” a Codeword for Recession?
Last Friday Fed Chairman Powell gave an incredibly important speech in Jackson Hole to dozens of economic and financial experts. Powell said inflation remains stubbornly high and cooling it will require forceful action that could soon bring “pain” to households and businesses nationwide and that this “pain are the unfortunate costs of reducing inflation.” I…
Why We Have High Inflation
One of my favorite economists to read weekly is Brian Wesbury, chief economist for First Trust. Brian reminds us that inflation by definition is too much money chasing too few goods. Brian says the #1 reason why we have high inflation is too much growth in the money supply (M2) which has grown by 41%…
2 More Reasons Why Home Building is Slowing Down
Zonda released their second quarter New Home Lot Supply Index last week and the index is down 9.3% from last year and the index measuring supply dropped by 2.2% from the first quarter. This index reflects the number of single-family vacant developed lots that are ready to be built upon. Denver saw the 3rd biggest…
New Home Construction is Slowing Down
Here is new home construction data from the National Association of Home Builders for the month of July. Higher mortgage rates are definitely slowing down the construction industry. We need about 1.7 million units built yearly to keep up with new household formations and the rebuilding of tear-down homes. · Housing starts were down nearly…
Is Zillow Right?
The DBJ ran a story last Friday with this headline-“Denver ranked #9 for cities with declining home values from June to July.” Zillow says Denver home values dropped by 1.8% from June to July, the 9th largest drop in the country. I read that Zillow is now factoring in listing price drops into this calculation.…
How Homebuilders Are Responding to the Market
There was a great article in the DBJ last week about how homebuilders have been impacted this year and how they are responding. The new home market is even more interest rate sensitive than the existing home sale market. Here are some highlights- · In June about 60k new home purchase contracts cancelled or fell…
Answers to the Top 5 Questions Homebuyers Have…
I have created a 20-minute Zoom presentation for our clients titled “Answers to The Top 5 Questions Homebuyers Need to Know Now.” It’s based off my new class that I have been teaching you. The 5 questions are- 1. How do rising mortgage rates impact home prices? 2. What happens to mortgage rates during a…
Is Now a Bad Time to Buy a Home?
Fannie Mae’s Home Purchase Sentiment Index for July fell 2 points to 62.8 its lowest level since 2011. Only 17% of consumers said now is a good time to buy a home while 67% said now is a good time to sell a home. When I think back to 2011 that was the year our…
Protect Your Clients with Our Lock & Shop
We offer Lock & Shop that allows homebuyers to lock in their interest rate BEFORE they are under contract on a home. We can lock in their rate for up to 90 days. And we combine this with our one-time interest rate float down option once they are under contract, their loan is approved by…
