If you are considering selling your current home, to either move up to a larger home or into a home in an area that better suits your current family needs, great news was just revealed.Last week,
Market Update August 31 2015
>> Market Update QUOTE OF THE WEEK... "The shortest answer is doing the thing." --Ernest Hemingway, American author and journalistINFO THAT HITS US WHERE WE LIVE... We certainly need no lengthy explanations concerning what's doing in the new home market. In July new single-family home sales headed up 5.3%, to a 507,000 unit annual rate, and are now up 25.8% over a year ago. These sales cooled off in June, but looking at the past year, new home sales averaged their fastest sales pace since 2008. Consequently, inventories gained by 4,000, yet the months' supply dropped from 5.3 in June to 5.2 in July. That faster selling pace gives builders a nice opportunity to step up construction activity and inventories. Remember, new home sales are still well below historic levels.Meanwhile, the Case-Shiller Home Price index edged up 1.0% in June and now stands 4.5% ahead of a year ago. Prices are up in all 20 major metro areas the index tracks. The Federal Housing Finance Agency (FHFA) index of prices for homes financed with conforming mortgages went up 0.2% in June and registered a 4.5% hike over a year ago. For those questioning existing home sales, what Pending Home Sales did in July provided a nice short answer. This measure of contracts signed on existing homes went up 0.5% for the month, following its 1.7% dip in June. That dip means existing home sales may slip in August, but they gained almost 10% the three prior months.BUSINESS TIP OF THE WEEK... Stay optimistic and remain resilient. Don't linger over those temporary setbacks and keep your focus on your longer term goals. >> Review of Last WeekWHIRLWIND ON WALL STREET...Check this out. The Dow Jones Industrial Average drops almost 600 points Monday, then sinks another 34 Tuesday. Wednesday it shoots UP over 600 points, followed by an almost 400 point hike on Thursday. Friday ends flat after all the tumult, leaving a modest weekly gain for the Dow and the broadly based S&P 500, but a bigger boost for the tech-heavy Nasdaq. What caused this whirlwind of volatility? Analysts put it to investor uncertainty about China's troubled economy, plus worries over when the Fed might start raising interest rates. The central bankers met at Jackson Hole, but comments from officials were hard to interpret. U.S. economic data painted the now familiar picture of a plodding recovery. Positive moves included the housing reports covered above and a 2% gain in Durable Goods Orders for July. The best news was the second estimate of GDP for the second quarter, which had the economy growing at a 3.7% annual rate. Personal Income and Spending were up in July, both good reads, and Core PCE Prices went up just 0.1%. This is bad news to the Fed, which wants to see higher inflation before raising rates. University of Michigan Consumer Sentiment slipped in July, but this contrasted sharply with the Consumer Confidence Index, which hit a 6-month high in August!The week ended with the Dow UP 1.1%, to 16643; the S&P 500 UP 0.9%, to 1989; and the Nasdaq UP 2.6%, to 4828.Bonds had a mixed week, with investors buying because of worries over China and selling over concerns a Fed rate hike will come soon. The 30YR FNMA 4.0% bond we watch finished the week down .05, at $106.11. National average fixed mortgage rates dipped to their lowest levels since May in Freddie Mac's Primary Mortgage Market Survey for the week ending August 27. This was put to Chinese financial market instability. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up to the minute information. DID YOU KNOW?... A recent survey reports that out of 75.3 million millennials, age 18 to 29, 93% want to own a home in the near future. >> This Week’s Forecast MANUFACTURING AND SERVICE SECTORS GROW, SO WE GET MORE JOBS... For August, the Chicago PMI measure of manufacturing health in the Midwest and the nationwide ISM Index are expected to stay above 50, signaling growth. The ISM Services read for that sector should also keep expanding. It's logical, then, that we'll see more jobs, and just over 200,000 new Nonfarm Payrolls are forecast for August, a tick more than we saw in July, so the Unemployment Rate is predicted to dip to 5.2% >> The Week’s Economic Indicator CalendarWeaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates. Economic Calendar for the Week of Aug 31 – Sep 4 DateTime (ET)ReleaseForConsensusPriorImpactMAug 3109:45Chicago PMIAug54.754.7HIGHTuSep 110:00ISM IndexAug52.652.7HIGHWSep 208:30Productivity-Rev.Q22.7%1.3%ModerateWSep 208:30Unit Labor Costs-Rev.Q2-0.8%0.5%ModerateWSep 210:30Crude Inventories8/29NA-5.452MModerateWSep 214:00Fed's Beige BookSepNANAModerateThSep 308:30Initial Unemployment Claims8/29273K271KModerateThSep 308:30Continuing Unemployment Claims8/252.261M2.269MModerateThSep 308:30Trade BalanceJul-$43.1B-$43.8BModerateThSep 310:00ISM ServicesAug58.460.3ModerateFSep 408:30Average WorkweekAug34.634.6HIGHFSep 408:30Hourly EarningsAug0.2%0.2%HIGHFSep 408:30Nonfarm PayrollsAug217K215KHIGHFSep 408:30Unemployment RateAug5.2%5.3%HIGH >> Federal Reserve Watch Forecasting Federal Reserve policy changes in coming months... A growing minority of economists see a rate hike in September or October, while a slim majority expect it in December. Note: In the lower chart, a 28% probability of change is a 72% certainty the rate will stay the same.Current Fed Funds Rate: 0%–0.25%After FOMC meeting on:Consensus Sep 170.00%-0.25%Oct 280.00%-0.25%Dec 160.25%-0.50%Probability of change from current policy:After FOMC meeting on:Consensus Sep 17 28%Oct 28 39%Dec 16 56%
THE CHIODO TEAM - Ralph Chiodo Broker / Owner 610-792-4800 x 111 Karen Chiodo Realtor / Owner 610-792-4800 x 102 Together Ralph and Karen (and their dedicated Tea....