What's Up Real Estate - Jobs Reports
📊 Jobs Report Highlights: JOLTS Report for August: The number of job openings surged by 8% month-over-month, reaching 9.6 million. This bucks the trend of the last three months. However, don't break out the champagne just yet. The hiring rate and separations rate (quits + layoffs) remained stable at 3.7% and 3.6%, respectively. What this means is that while job openings are plentiful, they aren't necessarily translating into actual employment gains. ADP's Report for September: The ADP's data for September shows just an 89,000 increase in private employment. This not only fell short of expectations but also marks the smallest gain since the early days of 2021. 📈 September Job Report Highlights: Total Nonfarm Payroll: +336,000 jobs, better than the 12-month average of +267,000. Key Sector Gains: Leisure & Hospitality: +96,000 jobs, outperforming a 12-month average of +61,000. Government: +73,000 jobs, beating the average gain of +47,000. Health Care: +41,000 jobs, a bit less than the 12-month average of +53,000. Professional Services: +29,000 jobs, pretty much in line with the average of +27,000. Social Assistance: +25,000, almost the same as the 12-month average of +23,000. Little to No Change: Transportation: +9,000 Information Sector: -5,000 Average Hourly Earnings: Increased by 7 cents to $33.88, a 4.2% rise year-over-year. 🔗 How It Ties with JOLTS & ADP Reports: JOLTS: High job openings but not turning into actual hires. ADP: Lower-than-expected job growth. BLS: Strong job gains, particularly in specific sectors. 🏦 Mortgage & Market Trends: 30-Year Mortgage Rates: Peaked at 7.74%, the highest in two decades. Triggered by a JOLTS report beat and Fed commentary. Purchase Index: Down 6% WoW and 22% YoY, lowest since 1996. Basically, higher rates are scaring off buyers. ARMs: Interest in adjustable-rate mortgages is up. People are looking for ways to dodge those high rates. 10-Year Treasury Yield: Touched 4.8% this week, influenced by the JOLTS beat but cooled down a bit with the ADP miss. 🤷♂️ What's Driving Rates?: JOLTs data, Fed commentary, quantitative tightening, and the job market. Pretty much a full house. 🗣️ MBA's Take: "The rapid rise in rates pushed an increasing number of potential homebuyers out of the market." 🎙️ Broken Records: If it feels like déjà vu, it's because we're breaking the wrong kinds of records. 🤔 Dallas' Bottom Line: The mortgage landscape is tough right now due to a cocktail of factors, including jobs data and Fed actions. Anyone looking to enter the market needs to buckle up; it's a wild ride. 🔗 References: BLS GOV: Job Openings and Labor Turnover Summary ADP Report: U.S. ADP Employment Change Mortgage Rates: Mortgage News Daily Mortgage Bankers Association: MBA Weekly Survey
What's Up Real Estate - Half Way Through
📉 August Homes Sales: A Rollercoaster Ride 🎢 New Home Sales: Dropped 8.7% to an annual rate of 675,000 units. Even builder incentives can't fight off those soaring mortgage rates. [Census Bureau] Pending Home Sales: Took a 7.1% nosedive. Brace yourselves; we're expecting 3.7–3.9 million units for September's existing home sales. [NAR] 📈 Plot Twist! Some Silver Linings 🌤️ Home Prices: The Case-Shiller Index climbed 0.6% in July, smashing previous records. Your equity might just be getting a boost! [S&P Global] 💰 About Those Mortgage Rates... 💸 New High: 30-year mortgage rates hit a two-decade peak at 7.65%. Rising yields globally and nearing $100/barrel oil prices signal inflation might be making a comeback. [Investopedia] [NY Times] Dallas' Take: What's the Game Plan? 🎯 Why Aren't People Selling? 🤷♂️ Holiday Seasons: Life changes prompting moves—like family or job changes—are less likely. Affordability Fears: With high interest rates, people worry about affording a new place. Data Deterrence: Month-over-month declines make homeowners hesitant to list. Lack of Inventory: This is keeping prices elevated, discouraging potential sellers who might want to upgrade. What It Means for Buyers 💡 You've got more leverage than before; less competition and more room to negotiate. But high prices aren't going away soon. Foreclosures and bank repossessions are up, providing some alternate routes if you are willing to gamble. [Attom Data] Interest rates are sky-high. Options to buy down rates are temporary and the Fed's dovish turn is uncertain. [Bank Rate] So, What's the Move? 💥 Sellers: If you can snag the right realtor who has access to cash buyers and investors, it's not the worst time to sell. Younger homeowners should likely hold, especially if you've got a killer interest rate. Buyers: If you can land a good deal and manage the short-term interest, go for it. For those with less financial stability, it might be smarter to wait and focus on career growth. In short, buy if you're stable, ready, and looking to hold.Dallas' Bottom Line: If you're in for the short term, selling might be your move. If you're in for the long haul, hold on (or as they say, "hodl").
What's Up Real Estate - September
🎉 Breaking News: The Fed's "Chill Vibes" Shake Up the Real Estate Game! 🏠 Guess what, folks? The Federal Reserve decided to kick back and do...well, nothing. Rates are staying the same for now. But don't be fooled—this 'do-nothing' move has everyone talking! 📈 The Good News:The Fed sees stronger economic growth on the horizon. That means businesses booming and more money in your pocket. 🎢 The Plot Twist:While the Fed lounges, mortgage rates are inching back to recent highs. House hunting getting a bit too hot for your liking? You're not alone—fewer people are sealing deals on homes. [industry intel - NAR] 💰 What's Up with Home Prices?Despite fewer transactions, home prices aren't getting the memo—they're still on the up and up. [Zillow HVI] [ZHVI Fred] 🔨 Builder Blues: Confidence Takes a Dive 📉 Hold on to your hard hats! Builder confidence just slid for the second month in a row. According to the National Association of Homebuilders, their Housing Market Index dipped below 50. That's bearish territory, folks, and it's the first time we've seen this since December 2022. [Builder Confidence Data] 💸 HVI's Crystal Ball: $20K in Home Appreciation! 🏡 The property portal's got some news for you. They're predicting a 4.9% boost in their Home Value Index (HVI) over the next year. Got a $400K house? That's almost a $20K increase in value! Sure, home prices and mortgage rates are soaring, but so is the "cost of waiting" when home prices are this hot. [BiggerPockets] 📉 LEI's Long Slump: 17-Month Losing Streak 📊 Heads up, economic junkies. The Conference Board's Leading Economic Indicators (LEI) Index fell 0.4% in August. We're talking 17 months of decline here. If we dodge a recession after all this, we might just quit paying attention to the LEI altogether. [The Conference Board] 🤔 Why Haven't You Bought Yet? Here's What People Say: 🗣️ Budget Woes - 34% can't find homes in their price range. Rate Watchers - 18% are waiting for those mortgage rates to dip. Price Drop Hopefuls - 9% think home prices will drop. Current Home Jitters - 7% worry about selling their existing home. Bid War Blues - 5% don't want to duke it out with multiple offers. Credit Crunched - 4% are stumbling on loan approval due to credit. Down Payment Dilemma - 3% just can't save up enough. Let's face it, 1/4 of you are waiting for that magic combo: lower home prices and mortgage rates. But here's the kicker: home prices are mainly going up. Time's ticking! ⏰ 💰 Down Payment Roadblocks: What's Holding You Back? 🚧 No Issue - 47% say they're good to go. Rent or Mortgage - 23% say current housing costs are the obstacle. Credit Card Debt - 17% point to their plastic. Student Loans - 12% blame education debt. Car Loan - 11% are strapped by their wheels. Almost 30% of you are held back by credit card or car loan debt. If you're in this club, chat with a lender about debt consolidation. Even at a 7.5% mortgage rate, you could save big on interest. [NAR Barriers of Home Buyers Survey] 👀 Confidence Dips but Competition Doesn't Chill 🥊 Future Traffic: Only 11% of Realtors expect more buyers soon, and a mere 10% see more sellers entering the fray. But don't let that fool you! Homes are still flying off the shelves like hotcakes, and the competition is, well, let's call it "fierce." 🏡 August 2023 Real Estate Fast Facts 📊 Speedy Sales: Homes spent just 20 days on the market, on average. Quick Turnover: 72% of homes sold were listed for less than a month (down slightly from 74% in July). First-Timers: They made up 29% of sales (steady as she goes!). Cash is King: 27% of sales were all-cash deals (also holding steady). Above Asking: 31% of homes sold for more than the list price. Bidding Wars: Each home sold had an average of 3.2 offers. [NAR Confidence Index] My Notes 📰 Press Release Rewind: The Fed's Adjective Shuffle 🎶 Read closely and you might notice: not much has changed since the Fed's last pow-wow. But let's break down some subtle wordplay: Economy: We went from "moderate" to "solid." So we're getting steadier, folks! Jobs: "Robust" is out, and "strong" is in. Rate Hikes: Eyes are still glued to the data. Inflation: Yep, it's still a concern. 2% target remains. Rate Forecast for 2023: Steady at 5.6%, implying a +25 basis point hike before year-end. Rate Forecast for 2024: Now at 5.1%, down from 4.6%. Expect fewer cuts, arriving later. 📈 What Does It All Mean? 🤔 The Fed's not rushing to slash rates. Good news: the economy and job market are holding up. Not-so-good news: homebuyers and us real estate folks might not see relief in mortgage rates anytime soon. [Fed Press Conference] 📅 That Wraps Up September! Up Next: Buyer's Season 🏠 To all my prospective buyers: the next few months are your time to shine. With folks stepping back for holiday festivities, you'll face less competition. Translation? Stronger negotiating power on price and interest rate credits. 📊 Worried About Rates? I've Got You Covered 👌 My real estate assistant doubles as a loan officer, and we can help you snag up to a 3% buy-down on your loan. Thanks again for being awesome readers, and until next time!
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