Home Sales Slide
Thankfully we saw the end of the government shutdown late last week, although it remains to be seen if this is a permanent measure or simply a stop-gap that will cover funding through the 15th of February. While this is positive news, it warrants mentioning that there is currently a backlog on data and it remains unclear when the impacted reporting will be released. For now, we will review the information that has been released and provide updates as more data becomes available.
One result of this lack of clear feedback that we are able to glean from economic data, there was not a lot of info that moved the market last week and we saw virtually unchanged mortgage rates. Last week we learned that median housing prices have increased 3% over last year, and that current supply is slightly larger. The data on sales of existing stock reflects a downturn from the previous month and a 10% from December 2018.
Commonly cited factors for this downward shift include equity market volatility, increases in mortgage rates and housing prices, and political fallout. We will be interested to note if this trend is ongoing or December's economic performance is due to temporary issues.
The jobs report that was released on Thursday reflected strength in the labor market as the jobless claims were at 199,000, the lowest amount reported since 1969. However, due to the Martin Luther King, Jr. holiday of January 14th, these numbers rely more heavily on estimates than is usual.
The ECB meeting was a bit of a non-event here in the U.S. as they declared that there will be no interest rate hikes, at least through the summer months. Global growth slowdown and geopolitical uncertainty contributed to the Central Bank's slightly more dovish response.
Coming up this week we'll be watching Friday's employment report, the Core PCE price index coming out on Thursday, and the ISM national merchandising index that will also be released on Friday. Trade talks between the U.S. and China, and their potential effect on mortgage rates, will also be on our radar. Give our office a call to discuss your loan options at 239-514-2674.
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