Weekly housing inventory data
One of the real positive stories heading into 2024 is that housing inventory is increasing year-over-year. Not a lot, but I think anything is positive. I’m a huge supporter of housing supply, and I feel like we’ll be much better off for the housing market once the total number of active listings returns to pre-COVID levels. But last week, inventories decreased week-over-week but increased year-over-year.
Here’s what happened last week:
- Weekly stock fluctuations (January 19th to January 26th): inventory has fallen 503,233 to 497,389
- Same week last year (January 20th to 27th): Inventory decreased compared to the previous year 466,391 to 457,717
- The bottom price of inventory in 2022 is 240,194
- Inventory peak in 2023 is 569,898
- Check out this week’s active list for context. 2015 was 936,253
New listing data
I was hoping for more new listing data in 2024, and while it’s positive year-over-year, it’s not as much as I would like. But at least it’s positive! While the number of new property listings in 2023 was at an all-time low, this should not be the case in 2024. Never forget that most sellers are also home buyers, especially if the economy is not in a job-loss recession.this is my topic It became a hot topic recently CNBC.
Weekly new listing data for the past few years:
- 2024: 44,167
- 2023: 40,767
- 2022: 40,370
price reduction rate
Every year, one-third of all homes have their prices reduced before they go on sale. This is a very traditional housing activity. However, as mortgage rates rise and demand takes a hit, discount rate data increases year after year.
A case in point was 2022. When housing inventory grew faster as demand collapsed, the rate of discounts also rose faster. This increase coincided with an upward trend in inventory, which meant people had to lower prices to sell their homes. Existing home sales stopped plummeting after November 2022, and this data line stabilized. As long as this trend continues, prices will drop below the 2023 rate by this spring.
This is the percentage price drop for the same week over the past few years.
- 2024: 30.6%
- 2023: 33%
- 2022: 19.2%
Mortgage interest rate and 10-year yield
The key to housing in 2024 is the 10-year yield. In my 2024 predictions for him, the 10-year yield ranges are: 3.21%-4.25%there’s a critical line in the sand 3.37%.If economic indicators are strong, it shouldn’t fall below this. 3.21%But if the labor numbers weaken, that line — I call it the Gandalf line, meaning “Thou shalt not pass” — will be tested.
This 10-year yield range means the following mortgage rates: 5.75%-7.25%, but this assumes the spread is still bad. Spreads have improved so much this year that even the 10-year yield of 4.25% will not be achieved. 7.25% in mortgage interest rates.
This week was jobs week and an unusual week for the 10-year Treasury yield and mortgage rates. federal reserve The Federal Open Market Committee (FOMC) was held. The 10-year yield is 4.13%became as low as 3.81Week ended in % 4.02%.This week’s mortgage interest rates are 6.88%fell to a low of . 6.63%then shot up to 6.92% As seen in the chart below, employment conditions were positive on Friday as the labor data was better than expected and the 10-year Treasury yield spiked along with mortgage rates. I also wrote about recruitment reports in this article.
I have always emphasized that labor data is more important for mortgage rates than inflation growth at this stage. The rate of inflation growth has slowed significantly. PCE inflation data is below 2% with 3-month and 6-month data line trends, but 10-year Treasury yields are still above 4% and mortgage rates are near 7%. .When unemployment insurance application data exceeds 323,000 The 4-week moving average is a different story as the 10-year yield is much lower.
Purchase application data
Last week was the first negative week in the purchase application data report since interest rates fell, with an 11% weekly decline and a 20% year-over-year decline. Interest rates have been creeping up, but they didn’t have a big impact on the data until last week. His 8 of the last 9 weeks I counted (after adjusting for holidays) have been positive, and for 2024, 2 positive prints versus 1 negative print.
We always like to weigh this index from the second week of January onwards to the first week of May. After May, the total amount traditionally always decreases. Similar to the 2022-203 data, demand is recovering as mortgage rates fall. The question is, what will happen to the rest of the hot season? Last year, interest rates spiked and then headed towards 8%. Unless the Fed screws up, this year should be a different story.
next week
After a week filled with labor data and comments from Federal Reserve Chairman Jerome Powell, we should have a quieter week with manufacturing data, household credit data and all-important unemployment claims.
I’ll be very interested to see how the 10-year Treasury yield trades, especially after Chairman Powell’s meeting on 60 Minutes on Sunday night, which could move the market. To their credit, remember that the Fed used the term restrictive policy when the 10-year bond yield was above 4.25% and headed toward 5%. Talk is cheap and they will need to do something before they want yields to fall to ensure they are focused on their dual mandate of keeping prices stable and employment high.
