30YR Fixed 6.40% -0.22% 15YR Fixed 5.89% -0.26%   Mortgage Rates Down to Lowest Levels of The Year It's official!  At this point, you'd need to go all the way back to the end of December 2023 to see a lower average rate for a top-tier, conventional 30-year fixed mortgage.  Today's rates are already fairly close to those late-December levels.  Any further improvement would result in the lowest levels since May 2023.   We were already at 6-month lows yesterday, so today didn't really change the game.  That said, this most recent rally represents an extension of a broader rally that began in May, and that one is definitely a game changer.  These past 3 months mark an abrupt shift in what had been a decisive uptrend in rates in Jan-April. Rates don't necessarily "decide" to spend an entire month doing one specific thing, nor are they guaranteed to remain in the sorts of linear trends seen so far this year.  There are good cases to be made for those trends aligning with the most relevant economic data and events. With that in mind, the events of the past 2 days clearly have the market thinking about additional rate-friendly economic data.  Today's installment consisted of the highest Jobless Claims reading in a year and big miss in an important manufacturing sector index.  This data caused rapid improvement in the bond market which, in turn, allowed mortgage lenders to set lower rates today. Tomorrow's economic data is an order of magnitude more important than today's.  The Employment Situation (aka "the jobs report") will be released at 8:30am ET.  It is one of the two most important reports on any given month and easily has the power to cause a big move for rates in either direction.

Why Markets Can’t Count on Inflation Data for Insight and 5 Other Things to Know Today. Traders are still in the dark about when the Federal Reserve might start cutting interest rates. Even two new inflation data points this week may not provide much more clarity. The producer price index is out Tuesday, and the consumer price index is on Wednesday. The CPI, in particular, has been sticky this year. A large part of that comes down to housing costs, which haven’t slowed as much as the Fed might have hoped, but it could also be statistical noise—and housing counts for a lot less in the Fed’s preferred inflation gauge, the personal consumption expenditures index. Also of note is that labor market data have been heavily revised this year, making them a bit harder to decipher. Morgan Stanley has identified another issue—the seasonal adjustments to the inflation data could be a bit off, making inflation appear hotter in the first half than it will in the second half of the year. If this all seems confusing, you’re not alone. Fed officials are also struggling to get a clear idea of what’s happening. There will be plenty of updates on their thinking, though, with almost a dozen speaking events this week. That includes Chair Jerome Powell on Tuesday. Here’s the bigger picture. Inflation is probably still slowing, even if the data looks bumpy. Consumers’ savings piles from the COVID-19 pandemic are gone, making them even more price-sensitive than they used to be. Retail sales figures and earnings this week from Walmart and Home Depot will add more color there. Pay particular attention to what executives say about the outlook, they’ve got their fingers on the pulse. And Fed officials may well indicate they would like to cut rates, even if the data won’t allow them to yet. That’s a good sign for investors, even if the first reduction isn’t imminent.

Plans to build the country's tallest skyscraper in the heart of Oklahoma City have attracted national and international attention. But not all the publicity has been positive. The 1,907-foot tall Legends Tower, proposed by developer Scot Matteson, would be part of the Boardwalk at Bricktown project planned for what is now a surface parking lot at Reno and Oklahoma Avenues in Lower Bricktown. The Oklahoma City Planning Commission this month recommended the city council approve zoning for a proposed 1,907-foot-high tower but warned they do not like renderings showing extensive use of LED signage throughout the four-tower development.  At the commission meeting, Oklahoma City resident Cynthia Ciancarelli questioned whether building the tallest tower in the United States might make it prone to natural disasters or a target for terrorists.  “Oklahoma City is a playground for investors,” Ciancarelli said. “Who wouldn’t want to invest in one of the of strongest economies in the U.S? But why do they want to build the tallest building in the United States? We have severe storms, earthquakes ― Oklahoma is one-stop shopping (for disasters).”  Would natural disasters really have a strong impact on the building? Here's what we know about plans to construct the tallest building in America: How tall would the proposed building be?The California developer announced plans last month to increase the height of the Legends Tower to 1,907 feet tall — a symbolic figure in that Oklahoma became a state in 1907. This would make the Legends Tower the tallest building in the U.S. and the fifth tallest in the world, the developers say. The tallest is the Burj Khalifa in Dubai, which is 2,716 feet tall. Will the skyscraper be safe from tornadoes, earthquakes?Modern skyscrapers are built to withstand high winds and earthquakes using technology that allows them to sway several feet in each direction without compromising its steel structure. However, if a high-rise building were to be in the midst of a tornado, it would likely sustain severe window damage. When a F3 tornado hit the Bank One Tower in Fort Worth in 2000, 80% of the 35-story tower's windows were destroyed. The building was almost demolished, but was instead converted into a residential tower.When will the OKC skyscraper be built?The project covers more than 3 acres and is planned to host more than 2 million square feet of residential, retail and entertainment development, including two Hyatt hotels, condos, apartments, stores and restaurants.The development will also have a lagoon and boardwalk. Also coming to the area, a new arena for the NBA franchise Oklahoma Thunder, which is expected to cost at least $900 million. Work on the first three 345-foot towers is scheduled to begin this year; the Legends Tower would be built after those are completed. Why was Oklahoma chosen for the country's tallest building?Pointing to a period of growth, Matteson said in a statement that Oklahoma City is "well-positioned to support large-scale projects like the one envisioned for Bricktown.” “We believe that this development will be an iconic destination for the city, further driving the expansion and diversification of the growing economy, drawing in investment, new businesses, and jobs," he said. "It’s a dynamic environment and we hope to see The Boardwalk at Bricktown stand as the pride of Oklahoma City.” Is it even possible to build the tallest skyscraper in the US in OKC?Norb Delatte, an engineering professor at Oklahoma State University, along with Jerome Hajjar, a professor at Northeastern College of Engineering in Boston, both said despite concerns about Oklahoma's location within Tornado Alley, among others, the tower is doable from a structural standpoint. “It’s certainly an unusual and distinctive structure for a city the size of Oklahoma City,” Hajjar said. “A building system like this, along with the surrounding buildings, can be an anchor for transforming the city.” 

The U.S. Supreme Court ruled unanimously on Friday that the government cannot demand hefty development fees from property owners in exchange for building permits. The case is being hailed by the National Association of REALTORS®, and other housing groups, as a major victory for property rights in a fight against what’s been called “exorbitant fees” tacked onto permit approvals in new development projects.  The Supreme Court’s ruling stems from a 2016 lawsuit filed by a California landowner, George Sheetz, after laws through his county government required him to pay more than $23,000 for a “traffic impact fee study” while he tried to obtain a permit to build a 1,800-square-foot manufactured home on his property. The county fees were implemented to help pay for roadwork and infrastructure in the community. Sheetz and his attorneys called the fees “unconstitutional” (specifically saying they violate the Takings Clause of the Fifth Amendment, which bars the government from taking private property for public use without “just compensation.”). After the lower courts sided with the county, Sheetz and his attorneys asked the U.S. Supreme Court to weigh in.  NAR and other housing groups sent letters of support regarding the case to the justices. “Impact fees have real consequences for homeownership in America, particularly with today’s high interest rates and limited housing affordability. Many prospective home buyers are priced out of the market by the tens of thousands of dollars in impact fees imposed on the average property owner,” NAR, the American Property Owners Alliance, the REALTORS® Land Institute, and the California Association of REALTORS® wrote in the amicus brief, filed with the court last year. Nationally, they said, the average impact fee on single-family homes exceeded $13,627 in 2019, while the costs in some states stretched much higher. In California, for example, impact fees average more than $37,000. Also, the housing groups cited housing studies showing how a $1,000 increase in the median price of a new home pushes about 140,000 households out of the real estate market.  The court’s decision will now allow developers and home builders to challenge fees that are commonly imposed by cities and counties to pay for new public improvements and infrastructure. Justice Amy Coney Barrett wrote: “In sum, there is no basis for affording property rights less protection in the hands of legislators than administrators. The Takings Clause applies equally to both—which means that it prohibits legislatures and agencies alike from imposing unconstitutional conditions on land-use permits.” Sheetz’s case will now be sent back to the state courts for further review, given the Supreme Court’s ruling.  NAR vows to continue to advocate for the property rights of homeowners in cases such as these. “Costly and burdensome requirements imposed on property owners, such as obtaining land-use permits as a condition of using or developing their property may be unrelated to the externalities of the development, may artificially increase the cost of real estate,” the association noted in its Washington Report about the case late last year. “At a time when many buyers are struggling to afford or find properties, government action must create certainty and stability in the housing market to promote development, support homeownership, and protect private property rights, which is why NAR is engaged in these various challenges.”  

Brant Point Construction Begins Denholtz Properties has broken ground on a collection of 16 luxury homes in Atlantic Highlands, seeking to lure buyers with what it describes as Nantucket-style living along Sandy Hook Bay. Known as Brant Point, the custom-designed, single-family dwellings will occupy seven acres just west of Avenue D and north of Center Avenue. Each will have four bedrooms and multiple bathrooms, with floorplans ranging from 2,601 to 3,473 square feet and outdoor spaces for year-round entertainment, Denholtz said, while residents will have easy access to Seastreak Ferry service providing a one-hour trip to New York City. The Red Bank-based developer joined project partners, investors and prospective residents this week to mark the start of construction at the property, noting that the first homes are slated to be completed in early 2025. “We are thrilled to begin construction of Brant Point, a community that will epitomize coastal living at its finest,” said Steven Denholtz, CEO of Denholtz Properties. “With its stunning views and carefully crafted homes, Brant Point offers residents a harmonious blend of Nantucket-inspired charm and modern luxury. We are confident that this enclave will not only redefine waterfront living in Atlantic Highlands but also set a new standard for coastal communities throughout Monmouth County.” The firm has tapped Deborah James of Sotheby’s International Realty as sales director for the project, which was designed by Spiezle Architectural Group and will have touches such as a slate feature wall with a gas fireplace, a full chef’s kitchen with an open pantry and landscaping with an irrigation system. Some homes will also have elevator options and two-car garages, while residents have the option to add a gunite pool. Lead Dog Custom Homes, a Red Bank-based luxury homebuilder, is managing construction.

  LONG BRANCH —Kushner officially broke ground yesterday, March 27, on a $130 million mixed-use residential and retail development in Long Branch. The project is poised to infuse new vitality into the city's Lower Broadway corridor, delivering 299 designer rental residences and upscale amenities, along with a highly anticipated SuperFresh grocery market and neighborhood café.   The long-awaited venture is set to be a lynchpin in connecting Lower Broadway to the city’s active beachfront, integrating with Kushner's Pier Village oceanfront community including the Wave Resort & Spa.Principals of Kushner hosted Long Branch Mayor John Pallone, Sen. Vin Gopal (D-11), fellow council members and other local dignitaries to mark the commencement of the project.Laurent Morali, CEO of Kushner, said, “Long Branch has always represented a long-term investment for us. This new project reinforces our overarching vision of establishing a thriving year-round destination by introducing premium residential, retail, and neighborhood services that support the community throughout every season."   Located at 118-119 Broadway and designed by Minno + Wasko Architects and Planners, the development will comprise two, four-story buildings with a mix of studio, one-, two- and three-bedroom homes. A rich array of upscale lifestyle amenities and social spaces spanning both properties will complement the residences. These include a 1,400-square-foot coworking lounge, fitness center, dedicated yoga room, golf simulator, rooftop terraces with ocean views, social lounges, pet spa, kids' room, grilling stations, fire pits and an outdoor pool.   Nicole Kushner Meyer, President of Kushner, added, “This development represents a significant stride in breathing new life into the downtown while underscoring Kushner’s unwavering commitment to the Long Branch community. Our focus extends beyond residential development, aiming to transform this underutilized land into new uses that will serve as an extension of Pier Village, including a supermarket catering to the year-round community.”Although efforts to revitalize Lower Broadway have been in the works for years as part of the City’s Redevelopment Plan, Kushner's involvement began in September 2022, diligently working with municipal agencies to advance the project.Michael Sommer, Chief Development Officer of Kushner, expressed excitement, stating, “We’re thrilled to expand our investment in the City of Long Branch and proud to have successfully propelled this critical project forward. The active involvement and guidance from Mayor John Pallone, the City Council, the Planning Board, the City Attorney, and the City Business Administrator were all instrumental, and we look forward to delivering another valuable asset to the community.”   State Sen. Vin Gopal praised the Kushner team for stepping up to revitalize a neighborhood that hasn’t shared in the investments made along the oceanfront.“This has been a long time coming,” said Sen. Gopal. “This property, as it gets going, is going to play an incredible role in the rest of Long Branch. We’ve seen other communities over the last 20 years — Asbury Park, Red Bank — really progress and this has been the piece to really unite Long Branch and make sure we can do that. The properties all across here, their values are going to go up because of this.”Since acquiring Pier Village in 2014, Kushner has continually expanded its offerings, which now encompasses 500 luxury apartments, 133,000 square feet of retail and two hotels.   This groundbreaking marks what promises to be an active year for Kushner in Monmouth County. The developer is actively redeveloping the Monmouth Mall in Eatontown into what is now known as Monmouth Square, reimagining it as a modern town center with 1,000 residential units, 900,000 square feet of retail, an active public green and pedestrian pathways.   Later this year, Kushner will break ground on a new residential development in Colts Neck, featuring 15 three-story buildings with 360 residences and upscale amenities.About KushnerKushner is a multi-generational real estate development and management firm headquartered in New York City. The company’s diverse portfolio encompasses residential, commercial, retail and hospitality with approximately 10,000 apartments under development and more than 25,000 apartments under ownership across 14 states.

30YR Fixed 6.91% +0.00% 15YR Fixed 6.47% +0.00%   Little Change in Mortgage Application Volume, Despite Lower Rates The Mortgage Bankers Association said its Market Composite Index moved lower last week, apparently indifferent to a slight improvement in mortgage interest rates. The Index, which measures loan application volume, decreased 0.7 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index declined 0.4 percent compared with the previous week. The Refinance Index decreased 2.0 percent from the previous week and was 9.0 percent lower than the same week one year ago. The refinance share of mortgage activity accounted for 30.8 percent of total applications compared to 31.2 percent the previous week.View Refinance Applications Chart The Purchase Index ticked down 0.2 percent both before and after its seasonal adjustment.  It was 16.0 percent lower than the same week one year ago.View Purchase Applications Chart “Mortgage application activity was muted last week despite slightly lower mortgage rates. The 30-year fixed rate edged lower to 6.93 percent, but that was not enough to stimulate borrower demand,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Purchase applications were essentially unchanged, as homebuyers continue to hold out for lower mortgage rates and for more listings to hit the market. Lower rates should help to free up additional inventory as the lock-in effect is reduced, but we expect that will only take place gradually, as we forecast that rates will move toward 6 percent by the end of the year. Similarly, with rates remaining elevated, there is very little incentive right now for rate/term refinances.”  Additional Highlights from the MBA Weekly Mortgage Application Survey Loan sizes slipped slightly lower last week. The average was $387,000, down from $389,800 and purchase loans averaged $441,800 compared to $445,000. FHA and the VA applications each accounted for a 12.0 percent share of the total, declining 0.1-point from the prior week. The USDA share remained at 0.5 percent. The average contract interest rate (6.93 percent) for conforming 30-year fixed-rate mortgages (FRM) was 4 basis points lower than a week earlier. Points decreased to 0.60 from 0.64. Jumbo 30-year FRM had an average interest rate of 7.14 percent, unchanged week-over-week. Points dropped to 0.38 from 0.54. The average contract interest rate for 30-year FRM backed by the FHA decreased to 6.75 percent from 6.89 percent, with points decreasing to 0.97 from 1.04 Fifteen-year FRM rates were down 3 basis points from the previous week to an average of 6.46 percent with points increasing to 0.75 from 0.70. The average contract interest rate for 5/1 adjustable-rate mortgages (ARMs) decreased to 6.27 percent from 6.33 percent. Points increased to 0.6 from 0.55.   The ARM share of activity moved from 7.2 percent of applications to 7.0 percent.

30YR Fixed 6.91% +0.00% 15YR Fixed 6.47% +0.00%   New Home Sales Decline Slightly, Prices Too Sales of newly constructed homes were virtually unchanged in February. The 662,000 seasonally adjusted annual units recorded in during the month was down by 2,000 units or 0.3 percent from the rate in January. This did, however, put sales 5.9 percent higher than they were in February 2023. The report from the U.S. Census Bureau and the Department of Housing and Urban Development estimated that, before adjustment, sales for the month totaled 60,000 units compared to 57,000 the previous month and 56,000 in February of last year. Thus far this year, sales of new homes are up 4.4 percent over the same period in 2023 at 117,000 units. The median price of houses sold during the reporting period was $400,500 and the average price was $485,000. In February 2023 the relative prices were $433,300 and $499,100. At the end of February there were an estimated 451,000 new homes available for sale. This is a projected 8.4-month supply at the current sales pace and is unchanged from the inventory level one year earlier. Robert Dietz, economist for the National Association of Home Builders noted, “Completed and ready-to-occupy inventory has increased 23 percent over the last year, rising to 85,000 homes. Homes advertised for sale but not started construction have increased almost 18 percent over the last year to 106,000. In contrast, homes available for sale that are under construction have declined 2 percent to 272,000.” New home sales plunged by 31.5 percent from January to February in the Northeast and were 60.9 percent lower year-over-year. The Midwest posted a 2.4 percent decline for the month, but sales increased 15.3 percent on an annual basis. Sales in the South rose 3.7 percent compared to January but were 10.0 percent lower for the year. The West posted increases of 2.3 percent and 43.4 percent from the two earlier periods.

Hey there, Sellers! Let's dive into some key real estate metrics that can help you better understand the current market trends and how they can impact your selling experience.   First up, we have the Months Supply of Inventory, which sits at a low 2.01. This indicates that there is a relatively low inventory of homes on the market compared to the current level of demand. With less competition out there, your property could stand out more to potential buyers.   Next, we see a 12-Month Change in Months of Inventory of -88.5%. This means that the inventory of homes for sale has decreased significantly over the past year, creating a more competitive market for sellers. With fewer homes available, yours could attract more attention from eager buyers.   When we look at the Median Days Homes are On the Market, we see a quick turnaround time of just 27 days. This suggests that homes in this area are selling fast, which could be great news for you if you're looking to sell quickly.   The List to Sold Price Percentage is a strong 99.6%, indicating that sellers in this market are typically getting very close to their asking price when their homes sell. This could give you confidence in setting an asking price that reflects the current market conditions.   Finally, the Median Sold Price in this area is $710,000. This gives you an idea of the average price at which homes are selling, allowing you to gauge where your property might stand in comparison.   Overall, these metrics paint a picture of a fast-moving and competitive market where homes are selling quickly and close to their asking prices. If you're thinking about selling, now could be a great time to capitalize on these favorable conditions. So, get ready to showcase your property and attract those eager buyers!

30YR Fixed 6.63% +0.02% 15YR Fixed 5.96% +0.01%   Pending Home Sales Stayed Sideways Near Record Lows The National Association of Realtors (NAR) releases two widely followed home sales reports.  Existing Home Sales measure transactions of homes other than new construction (i.e. previously owned and occupied homes).  The Pending Sales index is an advance indicator for Existing Homes.  It measures contract signings but not closed sales. Through a combination of historically low affordability and inventory, both metrics have been operating at the lowest levels in more than a decade (not including the temporary drop in pending sales seen at the onset of pandemic lockdowns). Today's pending sales update kept the index perfectly unchanged at those long term lows. There were small regional variations as follows: Northeast... +0.8% versus last month (down 6.4% from last year) Midwest .... +0.5% versus last month (down 2.2% from last year) South......... -2.3% versus last month (down 6.5% from last year) West.......... +4.2% versus last month (down 4.9% from last year) As seen in the chart above, the sharpest deceleration in the pace of sales is likely behind us.  Recent changes have been much smaller by comparison.  NAR is hopeful for 2024, citing the recent decline in mortgage rates. Additionally, NAR's Chief Economist Lawrence Yun noted "although declining mortgage rates did not induce more homebuyers to submit formal contracts in November, it has sparked a surge in interest, as evidenced by a higher number of lockbox openings."

30YR Fixed 6.62% -0.20% 15YR Fixed 6.15% -0.14%   Rates Plummet to Lowest Levels Since May, 2023 After Fed Announcement Today brought the scheduled Fed policy announcement that we've been waiting for and mortgage rates plummeted as a result.  So does that mean the Fed cut rates?  No...  The Fed kept its policy rate perfectly unchanged, as expected. In fact, it was unlikely that the Fed would have said anything significant in the actual policy announcement itself (although they did add a single word that hinted at the prevailing rate hike cycle being over).  Instead, today's focus was on the dot plot which the Fed uses to convey its outlook for the Fed Funds Rate 4 times per year. September's dot plot was bad for rates, but economic data and Fed speeches since then have led investors to expect today's dot plot to be much more friendly.  That ended up being exactly what happened with September's unfriendly changes being completely erased. 30 minutes later, Fed Chair Powell held a press conference in which he said nothing to object to the rate market's very strong reaction.  In other words, he saw the big drop in rates (as implied by bond trading levels) and didn't have a problem with it.  The market viewed this as a further endorsement of the momentum. When all was said and done the average 30yr fixed rate for a top tier scenario was nearly 0.30% lower than yesterday afternoon--one of the biggest single day drops on record.  Our rate index is now well into the high 6% range.

30YR Fixed 7.51% -0.18% 15YR Fixed 7.05% -0.05%   From 8% to Under 7.5%, Mortgage Rates Had a Near-Record Week The average top tier 30yr fixed mortgage rate was over 8% as recently as October 19th.  At the start of the present week, things weren't much better at 7.92%.  What a difference a few days make--especially the last 3.  The improvement seen on Wed-Fri is the 3rd biggest in well over a decade.  And if we throw out March 2020 (as we often do, due to unprecedented volatility relating to the onset of the pandemic), we're left with only one other example back early November of 2022. So is this some kind of seasonal pattern?  You'd be forgiven for drawing that conclusion, but in both cases, rates had recently surged to new long-term highs and then encountered surprisingly friendly economic data.  Last November it was a low reading in the Consumer Price Index (CPI) that gave investors hope regarding a shift in inflation.  Unfortunately, that shift proved to be a head-fake and rates continued lower into February of 2023, it's been up, up, and away since then. This time around, scheduled data gets the credit again, but there's a more robust assortment.  The good times began to roll on Wednesday after Treasury announced lower-than-expected auction amounts (lower supply of bonds relative to expectations means lower rates, all other things being equal).  The rally gained momentum with economic data at 10am and again with the Fed announcement in the afternoon.  Thursday was mild by comparison, but kept the trajectory intact with help from slightly higher Jobless Claims data, and especially from traders exiting bets on higher rates.  In the bond market, the simple act of "no longer betting on higher rates" forces a trader to effectively enter a bet on lower rates. This morning's jobs report was in a unique position to cast a deciding vote on the past 2 days of potential exuberance.  If jobs came in higher than forecast, the drop in rates would indeed have seemed overly exuberant and we would likely be seeing a decent push back.  As it happened, jobs were weaker than forecast.  Additionally, the unemployment rate ticked up more than expected and the past few months of jobs gains were revised lower. To be sure, the labor market is still exceptionally strong, but the rate market had been pricing in something even stronger.  Today's jobs numbers increasingly paint a picture of a labor market that is cooling back down to more historically normal levels.  Some economists and pundits are concerned about even more weakness, but we're not here to pontificate on the future. All we know is that this has been some of the best 3 days of news for mortgage rates and bonds that we've seen since rates first began to launch higher 2 years ago.  Granted, the magnitude of the drop is greatly facilitated by the fact rates were at multi-decade highs in the past few weeks, but we're not complaining. The average conventional 30yr fixed rate is now back below 7.5% for top tier scenarios.  You may see a very wide variety of rates today and early next week.  This sort of volatility makes lender offerings more stratified than normal.  Some of the lenders quoting rates with discount points are already able to do so in the high 6's.  Laggards are still near 8%.   As always, keep in mind that rate indices assume a flawless scenario and most scenarios aren't flawless.  The best way to use such an index is to track the day-over-day change from a known quote or baseline.  

30YR Fixed 7.33% +0.03% 15YR Fixed 6.65% +0.01%   Mixed Results for August Construction Results of the August Residential Construction report from the U.S. Census Bureau and the Department of Housing and Urban Development were decidedly mixed. While permits were issued at a rate higher than anticipated, housing starts sunk to the lowest level since June 2020, Construction was started on residential units at a seasonally adjusted annual rate of 1.283 million, an 11.3 percent decline from the July level of 1.447 million units. Further, the earlier results represent a downward revision from the original estimate of 1.452 million. Both Econoday and Trading Economics had consensus forecasts of 1.44 million units. Starts were 14.8 percent lower than in August 2022. Single-family starts were down 4.3 percent from July to an annual rate of 941,000. This, however, was 2.3 percent higher than the level a year prior. Multifamily starts plunged 26.3 percent month-over-month and 41.0 percent on an annual basis to a rate of 334,000 units. Permits for residential construction rose to a seasonally adjusted rate of 1.543 million units, a 6.9 percent increase from the 1.443 million rate in July and the highest level in ten months. Permits were, however, still down 2.7 percent on an annual basis. The number was about 100,000 units higher than consensus estimates. Construction permits were issued for 949,000 single-family homes on an annualized basis, a 2.0 percent increase from July and 7.2 percent more than a year earlier. Multifamily permits were 14.8 percent higher than the prior month but, at an annualized 535,000 units, down 17.7 percent from August 2022. On a non-adjusted basis, construction was started on 114,200 residential units, 84,100 of which were single-family houses. In July the totals were 130,600 and 91,200. Permits rose from 118,700 in July to 142,000 with single-family permits increasing from 77,800 to 88,400. Construction was completed on 126,000 units in August, an annualized rate of 1.406 million units. Single-family completions totaled 83,100, a rate of 961,000 units. At the end of August, there were 1.688 million units under construction, 676,000 of which were single-family houses. In addition, in addition, there was a backlog of 282,000 permits, 142,000 of them for single-family units. National Association of Home Builders analyst Danushka Nanayakkara-Skillington noted that, as an indicator of the economic impact of housing, there are now 676,000 single-family homes under construction, down 16.3 percent from a year earlier.  “Meanwhile, there are currently over 1 million apartments under construction. This is up 13.2 percent compared to a year ago (894,000). Total housing units now under construction (single-family and multifamily combined) are 0.8 percent lower than a year ago.” Over the first eight months of 2023, housing starts have totaled 960,000, 12.5 percent fewer than at the same point in 2022.  Single-family starts are down 15.1 percent and multifamily starts are 6.6 percent lower. Year to date, 1.007 million permits have been issued, a decline of 15.8 percent. Single family permits are 15.5 percent off last year’s pace, and those for multifamily units are down 17.7 percent. So far in 2023 there have been 946,600 homes completed, up 5.8 percent YTD. However, single-family completions are down 1.5 percent for the same period while multifamily homes account for a quarter of the total, with annual growth of 26.1 percent. The level of permitting rose by 9.3 percent in the Northeast compared to July and was 14.5 percent lower on an annual basis. The region saw the only monthly gain for starts, up 1.0 percent, but the rate plunged by 45.5 percent from the previous year. The Midwest posted a 14.3 percent increase in permitting for the month but lagged the prior August by 0.5 percent. Starts declined by 7.5 and 12.1 percent from the two earlier periods. Permits were issued in the South at a rate 3.9 percent higher than in July and 1.6 percent lower year-over-year. Starts were down 4.9 and 6.1 percent, respectively. Permitting jumped 9.4 percent in the West, remaining 2.1 percent lower the in August 2022. The West posted monthly and annual declines in starts of 28.9 percent and 20.2 percent.    

Why It’s Still a Seller’s Market Today Even though activity in the housing market has slowed from the frenzy that was the ‘unicorn’ years, it’s still a seller’s market because the supply of homes for sale is so low. But what does that really mean for you? And why are conditions today so good if you want to sell your house? The latest Existing Home Sales Report from the National Association of Realtors (NAR) shows housing supply is still astonishingly low. Housing inventory is measured by the number of available homes on the market. It’s also measured by months’ supply, meaning the number of months it would take to sell all those available homes based on current demand. In a balanced market, there’s usually about a six-month supply. Today, we have only about 3 months’ supply of homes at the current sales pace (see graph below):  As the visual shows, given the current inventory of homes, it’s still a seller's market. Today, we’re nowhere near what’s considered a balanced market. In fact, the current months’ supply is half of what’s typical of a normal market. That means there just aren’t enough homes to go around based on today’s buyer demand. As Lawrence Yun, Chief Economist for NAR, says: “There are simply not enough homes for sale. The market can easily absorb a doubling of inventory.” How Does Being in a Seller’s Market Benefit You? Sellers, these conditions give you a real edge. Right now, there are buyers who are ready, willing, and able to purchase a home. And, because there's a shortage of homes up for sale, the ones that do hit the market are like magnets for those buyers. If you work with a local real estate agent to list your house right now, in good condition, and at the right price, it could get a lot of attention. You might even end up with multiple offers. Bottom Line Today’s seller’s market sets you up with a big advantage when you sell your house. Because supply is so low, your house will be in the spotlight for motivated buyers who are craving more options. Let’s connect so you understand what’s happening in our local area as you get ready to enter the market.

Expert Home Price Forecasts Revised Up for 2023 Toward the end of last year, there were a number of headlines saying home prices were going to fall substantially in 2023. That led to a lot of fear and questions about whether there was going to be a repeat of the housing crash that happened back in 2008. But the headlines got it wrong. While there was a slight home price correction after the sky-high price appreciation during the ‘unicorn’ years, nationally, home prices didn’t come crashing down. If anything, prices were a lot more resilient than many people expected. Let's take a look at some of the expert forecasts from late last year stacked against their most recent forecasts to show that even the experts recognize they were overly pessimistic. Expert Home Price Forecasts: Then and Now This visual shows the 2023 home price forecasts from seven organizations. It provides the original 2023 forecasts (released in late 2022) for what would happen to home prices by the end of this year and their most recently revised 2023 forecasts (see chart below): As the red in the middle column shows, in all instances, their original forecast called for home prices to fall. But, if you look at the right column, you’ll see all experts have updated their projections for the year-end to show they expect prices to either be flat or have positive growth. That’s a significant change from the original negative numbers. There are a number of reasons why home prices are so resilient to falling. As Odeta Kushi, Deputy Chief Economist at First American, says: “One thing is for sure, having long-term, fixed-rate debt in the U.S. protects homeowners from payment shock, acts as an inflation hedge - your primary household expense doesn't change when inflation rises - and is a reason why home prices in the U.S. are downside sticky.” A Look Forward To Get Ahead of the Next Headlines For home prices, you’re going to continue to see misleading media coverage in the months ahead. That’s because there’s seasonality to home price appreciation and they’re going to misunderstand that. Here’s what you need to know to get ahead of the next round of negative headlines. As activity in the housing market slows at the end of this year (as it typically does each year), home price growth will slow too. But, this doesn’t mean prices are falling – it’s just that they’re not increasing as quickly as they were when the market was in the peak homebuying season. Basically, deceleration of appreciation is not the same thing as home prices depreciating. Bottom Line The headlines have an impact, even if they’re not true. While the media said home prices would fall significantly in their coverage at the end of last year, that didn’t happen. Let’s connect so you have a trusted resource to help you separate fact from fiction with reliable data.

Where Are People Moving Today and Why? Plenty of people are still moving these days. And if you’re thinking of making a move yourself, you may be considering the inventory and affordability challenges in the housing market and wondering what you can do to help offset those. A new report from Gravy Analytics provides insight into where people are searching for homes and what they’re prioritizing most right now. That information could help you plan your own move. 1. People Are Moving to Cities with Lower Housing Costs One big factor motivating where buyers are going is affordability and that’s no big surprise. People are relocating to areas that have less expensive housing options. As a result, small cities are thriving. Hannah Jones, Economics Data Analyst at Realtor.com, summarizes why: “Affordability is still very much front and center . . . a lot of what’s available is outside of the price range of many buyers. . . . so they look elsewhere for a little more bang for the buck.” The takeaway for you? If you’re having trouble finding a home that fits your budget, it may help to browse other, more affordable locations nearby. 2. People Want to Live Where They Vacation And, if you’re already expanding your search radius, you may be able to include a location that features your favorite type of destination, like a suburb near the beach or a mountain town. Data shows many other homeowners are making that type of move a priority today. According to the same report from Gravy Analytics: “Whether it’s the opportunity to enjoy more weekend hikes in the mountains or to wake up to a lakeside sunrise, people are moving to areas that were once thought of as vacation spots.” Even with today’s home prices and mortgage rates, here’s why a move like this could be possible for you. If you’re already a homeowner, the equity you’ll get when you sell your current house can help fuel that move and give you the down payment you’d need for your dream home. 3. People Who Work Remotely Are Taking Advantage of that Flexibility Ongoing remote work is another major factor in where people are moving. A recent report from the McKinsey Global Institute says this about recent movement patterns: “Many of these moves happened because employees untethered from their daily commutes began to care less about how far they lived from the office.” If you’re a remote or hybrid worker, you don’t have to live in the same city, or sometimes even the same state, as your job. That means you can prioritize other things, like being closer to loved ones, when buying a home. In fact, the same McKinsey Global Institute report notes for people who moved during the pandemic, 55% reported moving farther from the office. And since remote work is still a popular choice today, homebuyers will likely continue to take advantage of that flexibility. Bottom Line Lots of people are still moving today. If you want help navigating today’s inventory or affordability challenges, and expert advice to help you find your ideal home, let's connect.

Home prices continue to climb with ‘striking’ regional differences, says S&P Case-Shiller Prices nationally rose 0.7% month to month, seasonally adjusted. The index’s 10-city composite fell 1%, year over year, slightly less than the 1.1% decrease in the previous month. The 20-city composite dropped 1.7%, the same as the annual decline in April. Home prices in May rose for the fourth straight month on the S&P CoreLogic Case-Shiller home price index, but regional differences are widening. The gains come despite a sharp jump in mortgage interest rates during the month. Prices nationally rose 0.7% month to month, seasonally adjusted. The index’s 10-city composite gained 1.1%, and the 20-city composite gained 1%. Prices nationally were still down 0.5% compared with May 2022, but they are just 1% below their June 2022 peak. The 10-city composite fell 1%, year over year, slightly less than the 1.1% decrease in the previous month. The 20-city composite dropped 1.7%, the same as the annual decline in April. “Home prices in the U.S. began to fall after June 2022, and May’s data bolster the case that the final month of the decline was January 2023,” said Craig Lazzara, managing director at the S&P DJI. “Granted, the last four months’ price gains could be truncated by increases in mortgage rates or by general economic weakness. But the breadth and strength of May’s report are consistent with an optimistic view of future months.” Lazzara, however, noted that “regional differences continue to be striking,” with cities in the so-called Rust Belt outperforming the rest of the nation. Prices in Chicago gained 4.6%; in Cleveland, 3.9%; and New York, 3.5% — making for the top performers. The Midwest took over the South’s reign as the strongest region. “If this seems like an unusual occurrence to you, it seems that way to me too. It’s been five years to the month since a cold-weather city held the top spot (and that was Seattle, which isn’t all that cold),” added Lazzara. Of the 20-city composite, 10 cities saw lower prices in the year ended May 2023 versus the year ended April 2023 and 10 saw higher prices. Cities in the West, where prices had inflated the most, were the worst performers in May. Seattle, down 11.3%, and San Francisco, down 11%, were the worst. Prices are rising again because supply is still very low. Current homeowners are reluctant to sell, given that most are paying mortgage rates that are less than half of today’s rates. Demand returned after the initial jump in mortgage rates, as buyers seem to be getting used to a new normal. “The housing market remains unaffordable for many buyers, but some areas are seeing high levels of competition as a result of low for-sale inventory,” said Hannah Jones, research analyst at Realtor.com. “Limited existing home stock means many markets are seeing competition reminiscent of the last few years.”    

Don’t Fall for the Next Shocking Headlines About Home Prices If you’re thinking of buying or selling a home, one of the biggest questions you have right now is probably: what’s happening with home prices? And it’s no surprise you don’t have the clarity you need on that topic. Part of the issue is how headlines are talking about prices. They’re basing their negative news by comparing current stats to the last few years. But you can’t compare this year to the ‘unicorn’ years (when home prices reached record highs that were unsustainable). And as prices begin to normalize now, they’re talking about it like it’s a bad thing and making people fear what’s next. But the worst home price declines are already behind us. What we’re starting to see now is the return to more normal home price appreciation. To help make home price trends easier to understand, let’s focus on what’s typical for the market and omit the last few years since they were anomalies.  Let’s start by talking about seasonality in real estate. In the housing market, there are predictable ebbs and flows that happen each year. Spring is the peak homebuying season when the market is most active. That activity is typically still strong in the summer but begins to wane as the cooler months approach. Home prices follow along with seasonality because prices appreciate most when something is in high demand. That’s why, before the abnormal years we just experienced, there was a reliable long-term home price trend. The graph below uses data from Case-Shiller to show typical monthly home price movement from 1973 through 2021 (not adjusted, so you can see the seasonality): As the data from the last 48 years shows, at the beginning of the year, home prices grow, but not as much as they do entering the spring and summer markets. That’s because the market is less active in January and February since fewer people move in the cooler months. As the market transitions into the peak homebuying season in the spring, activity ramps up, and home prices go up a lot more in response. Then, as fall and winter approach, activity eases again. Price growth slows, but still typically appreciates. Why This Is So Important to Understand In the coming months, as the housing market moves further into a more predictable seasonal rhythm, you’re going to see even more headlines that either get what’s happening with home prices wrong or, at the very least, are misleading. Those headlines might use a number of price terms, like: Appreciation: when prices increase. Deceleration of appreciation: when prices continue to appreciate, but at a slower or more moderate pace. Depreciation: when prices decrease. They’re going to mistake the slowing home price growth (deceleration of appreciation) that’s typical of market seasonality in the fall and winter and think prices are falling (depreciation). Don’t let those headlines confuse you or spark fear. Instead, remember it’s normal to see a deceleration of appreciation, slowing home price growth, as the months go by. Bottom Line If you have questions about what’s happening with home prices in our local area, let’s connect.