Market Movement - May 25, 2020 - Real Estate | Property Management


Mortgage rates trended lower this week and continue to hover historic lows. Home builder sentiment rebounded after a record drop the previous month. Housing starts and building permits each declined. New purchase mortgage application submissions increased but refinance mortgage application submissions declined. The Federal Open Market Committee released the minutes from its previous meeting. Jobless claims continue to reflect widespread layoffs and furloughs. Existing home sales declined, as expected.
MORTGAGE RATES CURRENTLY TRENDING THIS WEEK’S POTENTIAL VOLATILITY
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The National Association of Home Builders’ (NAHB) housing market sentiment index turned around in May, after April’s significant drop. Current sales conditions increased to 42, sales expectations for the next six months climbed to 46, and buyer foot traffic ticked up to 21. Housing starts and building permits each declined in April, reflecting widespread shutdowns and closures. Housing starts dropped 30% month-over-month to a seasonally adjusted annual rate of 891,000, the slowest pace in 5 years. Building permits also fell, down 20.8% to a seasonally adjusted annual rate of 1.07 million. For the week ending 5/15, new purchase mortgage application submissions increased 6.0% and refinance application submissions decreased 6.0% for a composite decrease of 2.6%. The data indicates home buyers are returning to the market after stalling in April. The minutes from the April FOMC meeting were released on Wednesday. The Fed did not move interest rates during this meeting, after two emergency rate cuts in March. In the minutes, the Fed noted it would continue to evaluate economic conditions specifically unemployment and inflation before making any further interest rate decisions. For the week ending 5/16, initial jobless claims increased by 4.4 million, suggesting layoffs are starting to taper off. Continuing claims increased to a level of 22.9 million. Existing home sales fell 17.8% month-over-month in April to a seasonally adjusted annual pace of 4.33 million.

This week’s important economic reports include: Case-Shiller home price index FHFA house price index Consumer confidence index New home sales MBA applications Jobless claims Gross domestic product Pending home sales index Personal income, consumer spending, core inflation Consumer sentiment index
WEEK OF MAY 25, 2020