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Thoughts to Ponder and The Market Update January 23

Thoughts to Ponder and The Market Update January 23
January 23, 2017 abryant

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Thoughts to Ponder . . .

  • The secret of success is to go from mistake to mistake without losing your enthusiasm.
  • Dear automatic flushing toilet… I appreciate the enthusiasm, but I wasn’t done yet.
  • Why must I prove that I am me when I pay bills over the phone? Did some else call to pay my bills, and if they did, why don’t you let them?
  • I’m not afraid of flying, I’m afraid of not flying.

 

 

And Now on to The Market Update . . .

The euphoria in the markets over the “Trump factor” has clearly worn off.

  • For three week’s now, the Dow Jones Industrial Average has been trying to break the 20,000 mark and has yet to do it.
  • Recent concerns over some of President (As of Friday January 20th) Trump’s policies and plans, as well as other happenings internationally, has investors concerned.

 

The big news this week has been in housing.

  • Real estate and mortgage professionals around the country are reporting a significant increase in purchase activity.
  • It appears that people who have been considering buying a home are now jumping into the market.
  • The reason for the increase in activity is attributed to both the end of the holiday hangover, and the fact that many purchasers want to get in while mortgage rates remain very low.

 

Next week there are three important housing reports coming out, however this week we already had a couple that confirm the positive direction of the market.

  • The Housing Market Index, which is a survey conducted by The National Association of Home Builders in which responders are asked to rate the general economy and housing market conditions, jumped an unusually strong 7 points in December.
  • This is pointing to significant positive momentum for housing heading into the new year.
  • As I stated earlier, buyer activity has already increased just in the last week.
  • Builder confidence is the highest since the sub-prime boom back in 2007.

 

Housing starts, which measure the registered start of a new residential building or home, leaped 11.3 percent in December.

  • The driving factor in the increase is multi-units versus single-family homes.
  • The positive movement is still a very welcome sign for the direction of housing, and a great way to kick off the new year.

 

Mortgage rates have risen in the last week however, the recent rate decline did what it normally does, boosted refinance applications.

  • According to the Mortgage Bankers Association of America, applications for refinancing jumped 7.0 percent for the week ending January 13th.
  • Purchase applications declined 5.0 percent however, that number does not have me concerned at all.
  • Purchase activity almost always is down immediately following the holidays.
  • With the latest activity reported in the market just this week, it is clear buyers are hitting the streets.
  • As well, it appears that more sellers are listing their homes for sale, which should begin to slowly ease inventory shortages that exist in many markets.

 

First time jobless claims were reported for the week of January 14th to be only 234,000.

  • This is the lowest the figure has been dating all the way back to the 1970’s.
  • This too is great for housing.

 

This week’s potential market moving reports are:

  • Monday January 23rd – Dallas Fed Manufacturing Survey
  • Tuesday January 24th – Existing Home Sales
  • Wednesday January 25th – MBA Applications & FHFA House Price Index
  • Thursday January 26th – First Time Jobless Claims & New Home Sales
  • Friday January 27th – Durable Goods Orders & GDP