With housing inventory on the decline, the impact of lower mortgage rates is a hot topic in the real estate market. The numbers tell an interesting story, shedding light on the current state of affairs in the housing industry. Let’s dive into the data and analyze what’s been happening.
Weekly Housing Inventory Data
- In a typical year, when mortgage rates stand high at over 7.25%, weekly housing inventory should grow steadily.
- Surprisingly, this growth model didn’t materialize even once last year, despite being the norm in previous years.
- With rates dropping below the 7.25% mark recently, inventory growth still hasn’t reached the projected levels.
- Nonetheless, the past month has seen healthy inventory growth, but with seasonal factors like the traditional decline in active inventory playing a role.
- Compared to the dismal numbers in 2023, 2024 shows promising signs of much-needed improvement in active listings.
New Listings Data
- New listings have been a major player in driving this year’s inventory growth.
- Although we fell short of the target during peak seasonal weeks, the overall trend has been positive.
- While there was a slight dip in new listings last week, 2024 still outperforms the record low figures of 2023.
- A highlight has been a gradual increase in new listings, especially as mortgage rates trended downwards.
Price-Cut Percentage
- Price cuts, a common practice in the housing market, can signal market activity.
- The price cut percentage surged this year with the rise in mortgage rates, indicating increased inventory levels.
- As we compare the weekly price-cut percentages across recent years, 2024 seems poised to register better figures than in 2022.
Weekly Pending Sales
- The weekly pending contract data offers real-time insights into market demand.
- There’s a marginal increase in year-over-year figures, showcasing steady growth.
- This data suggests sustained interest from buyers, even as rates fluctuate.
Purchase Application Data
- Falling mortgage rates have led to fluctuations in purchase application data.
- The recent drops in rates have spurred positive trends, though the impact is yet to be fully realized.
- A closer look at this data reveals the intricate relationship between mortgage rates and home sales.
10-Year Yield and Mortgage Rates
- The interplay between the 10-year yield and mortgage rates underscores the market’s fluidity.
- Economic factors continue to shape the trajectory of mortgage rates, with predictions and forecasts guiding market trends.
- Fluctuations in the 10-year yield pose challenges and opportunities for mortgage rate movements.
Mortgage Spreads
- The improvement in mortgage spreads this year marks a positive shift from the narrative of 2023.
- A look back at the spreads from the previous year highlights the impact on current mortgage rates, showing room for further improvement.
- The ongoing evolution of mortgage spreads emphasizes the role they play in shaping housing market dynamics.
The Week Ahead: Powell’s Jackson Hole Talk
- Fed Chair Jerome Powell’s upcoming speech at the Jackson Hole event will be a focal point this week.
- Anticipated hints of a Fed funds rate cut in September have market players bracing for potential impacts.
- The market awaits key data releases and speeches from Federal Reserve officials, setting the stage for a week of economic insights and market movements.
In conclusion, the real estate landscape remains dynamic, with mortgage rates and inventory levels at the forefront of industry discussions. As we navigate the changing tides, keeping a close eye on these trends will be crucial for market participants. Stay tuned for more updates on how these factors shape the housing market in the weeks to come.
