QUOTATION OF THE WEEK
“I want my children to have all the things I couldn’t afford. Then I want to move in with them.” –Phyllis Diller, American comedian
INFO THAT HITS US WHERE WE LIVE
The National Association of Realtors Pending Home Sales, an index of contracts signed on existing homes, fell 4.7% in January. Low inventory was the culprit, but the NAR’s chief economist sees hope, as starts near the “historical annual average of 1.5 million.”
Housing reports tend to be volatile month-to-month, so the NAR is sticking to its forecast of 5.5 million existing home sales this year, virtually identical to 2017’s 5.51 million.
New Home Sales took a 7.8% January tumble, to a 593,000 yearly rate. But, hey, last year these sales hit their highest total in a decade. One property economist offered: “With inventory levels at nine-year highs, and demand supported by rising household incomes, new home sales are set for a decent 2018.”
BUSINESS TIP OF THE WEEK
Technology levels the playing field, so it’s vital to focus on your unique brand–that’s the quality of the client experience you provide, the emotional connection you make with clients and what they tell others about you.
Review of Last Week
DOUBLE WHAMMY… After moving ahead the two prior weeks, stocks went lower last week, as investors got the double whammy of Fed Chair Jerome Powell’s Congressional testimony, and the President’s trade tariffs, 25% on steel and 10% on aluminum. Both point to the possibility of more rate hikes.
Powell testified that his economic projections have improved, making investors fear there might be four rate hikes this year. And though tariffs likely won’t give us the trade wars and economic hits others bemoan, they could hike inflation–and interest rates. Please note: the tariffs aren’t yet set in stone!
At least consumers are sanguine about rates. January’s University of Michigan Consumer Sentiment reported consumers show little concern about growing interest rates, as the Index shot up to its second highest level in 14 years.
The week ended with the Dow down 3.0%, to 24538; the S&P 500 down 2.0%, to 2691; and the Nasdaq down 1.1%, to 7258.
Bonds proved volatile, with advances following declines and vice versa. The 30YR FNMA 4.0% bond we watch lost .09, to $102.38. Freddie Mac’s latest Primary Mortgage Market Survey had national average 30-year fixed mortgage rates up, now eight weeks in a row. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
DID YOU KNOW?
The share of buyers willing to make an offer on a home sight unseen is growing. An online real estate database reports 35% of recent buyers made an offer without first visiting the home.
This Week’s Forecast
SERVICES SECTOR GROWS, ALONG WITH JOBS… It’s good to see the February ISM Services index is still up there. A read above 50 indicates growth, and we’re staying well north of that threshold. The services sector of the economy provides the bulk of our jobs, so it makes sense that new Nonfarm Payrolls are forecast at more than 200,000, while the Unemployment Rate ticks down again.
