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,
May 18 Market Update
>> Market Update QUOTE OF THE WEEK... "You have to expect things of yourself before you can do them."--Michael Jordan, former professional basketball player, team owner, and entrepreneur INFO THAT HITS US WHERE WE LIVE... The economic forecast forum at the National Association of Realtors (NAR) Legislative Meetings expects existing home sales to finish 2015 at their highest level since 2006. In fact, existing home sales in March jumped 6.1%, to 5.19 million units, its highest annual rate in 18 months, providing a nice start to the spring home buying season. But the NAR's chief economist cautioned that "housing supply needs to increase measurably to meet the pent-up demand for buying." Fortunately, he also expects housing starts at around 1.1 million this year and 1.4 million the next, almost reaching the 1.5 million rate needed to meet underlying demand.Expectations are also high at the National Association of Home Builders (NAHB). Their latest survey found 85% of metro areas saw an uptick in home affordability. The NAHB put this to mortgage rates dropping and home prices advancing at a more moderate rate. Their chief economist notes, "The past two quarters have seen an improvement in affordability...[which] should help encourage more buyers to enter the marketplace." The chief property economist at a major research consultancy tells us, "nine out of ten people still see homeownership as a key part of the American dream." And a survey by a national listing site reports 5.2 million renters expect to buy a home this year.BUSINESS TIP OF THE WEEK... Start each day by making a list of the 5 most important tasks you need to accomplish. Then do those first. You'll never be behind on the things that count! >> Review of Last WeekHAPPY BIRTHDAY, BIG BOARD... Founded on May 17, 1792, the New York Stock Exchange reached its 223rd birthday yesterday. Being Sunday, the Big Board was dark and the building was closed, but the market had already celebrated. Friday, the three major indexes ended UP for the week, with the S&P 500 posting its second record close in two days! This birthday present was a surprise to some analytically minded observers, who thought weak economic data would sour investor sentiment. These folks were of course confusing how disappointments affect us in the real world with how disappointments can be minimized on Wall Street, or even treated as encouraging developments.Disappointments included April Retail Sales, which were flat, missing expectations for the fifth month in a row. The Producer Price Index (PPI) showed wholesale prices dropping, not what the Fed wants to see. Initial Unemployment Claims did recede to 264,000, and the four week average hit a 15-year low, while the New York Empire Manufacturing Index rose to a positive reading. But Industrial Production declined and Michigan Consumer Sentiment fell to a 7-month low. The negatives, however, were minimized, because although growth is slow and halting, we're not falling back into recession. They were even seen as encouraging, since they mean the Fed should keep rates low.The week ended with the Dow UP 0.4%, to 18273; the S&P 500 UP 0.3%, to 2123; and the Nasdaq UP 0.9%, to 5048.As stocks sailed into record territory, money backed out of bonds. But there was enough negative economic news to keep bond prices from sinking very far. The 30YR FNMA 4.0% bond we watch finished the week down a miniscule .03, to $106.24. Freddie Mac's Primary Mortgage Market Survey for the week ending May 14 showed national average fixed mortgage rates edging up for the third week in a row. They're still below their highs for 2015 and remain near historical lows. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up to the minute information. DID YOU KNOW?... The pessimists are disappearing. In Fannie Mae's April economic survey, the share of respondents who expect their personal financial situation to worsen in the next 12 months dropped to 10%, a survey low. >> This Week’s Forecast BUILDERS BUILD, EXISTING HOMES SELL, THE FED TALKS... This week gives us some key reads on the housing market, and they're expected to be pretty good. Builders were more active in April, with Housing Starts forecast to surpass the one million unit annual rate. Thursday's Existing Home Sales should show those transactions moving further up into 5 million unit annual rate territory. In between those two reports, we'll get FOMC Minutes from the Fed's last meeting. As usual, the pundits will pore over this narrative for clues to when the central bank may start to raise rates. The Consumer Price Index (CPI) is predicted to deliver a benign inflation rate. >> 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 May 18 – May 22 DateTime (ET)ReleaseForConsensusPriorImpactTuMay 1908:30Housing StartsApr1.019M926KModerateTuMay 1908:30Building PermitsApr1.065M1.039MModerateWMay 2010:30Crude Inventories5/16NA–2.191MModerateWMay 2014:00FOMC Minutes4/29NANAHIGHThMay 2108:30Initial Unemployment Claims5/16270K264KModerateThMay 21 08:30Continuing Unemployment Claims5/92.250M2.229MModerateThMay 2110:00Existing Home SalesApr5.24M5.19MModerateThMay 2110:00Philadelphia Fed IndexMay8.07.5HIGHThMay 2110:00Leading Economic Indicators (LEI)Apr0.3%0.2%ModerateFMay 2208:30Consumer Price Index (CPI)Apr0.1%0.2%HIGHFMay 2208:30Core CPIApr0.2%0.2%HIGH >> Federal Reserve Watch Forecasting Federal Reserve policy changes in coming months... The latest readings show that even fewer economists think the Fed will start raising rates during the first nine months of the year. Let's hope they're correct. Note: In the lower chart, a 7% probability of change is a 93% certainty the rate will stay the same.Current Fed Funds Rate: 0%–0.25%After FOMC meeting on:Consensus Jun 170%–0.25%Jul 290%–0.25%Sep 170%–0.25%Probability of change from current policy:After FOMC meeting on:Consensus Jun 17 0%Jul 29 5%Sep 17 18%
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....