POST TAGSMarket Updates
Blog posted On December 05, 2023
Rates tumbled down to the lowest levels in three months last week, giving hopeful buyers and owners much needed relief. The underlying cause was movement in the bond market, which influences rate trends. Right now, the market is walking on eggshells. Last week’s progress could easily be reversed by the results from this week’s economic reports – mainly the jobs reports. However, if the jobs reports come in weaker than expected, they could help push rates even lower.
We’ve already received the data from October’s Job Openings and Labor Turnover Survey (JOLTS). Job openings were much lower than economists had expected. This is a good sign of labor market tightening, which is good for rates. However, tomorrow’s ADP nonfarm employment change from November could tell a different story. It’s projected to increase slightly. Then, of course, the main event of the week will be the employment situation reports on Friday, which include payroll, unemployment, and earnings data.
We also heard from the CoreLogic home price index and the Black Knight home price index from October. Core Logic found that home prices rose 0.2% in October, which brings the index to a new all-time high. Black Knight reported that home prices rose 0.2% in October and 4.6% year-over-year, marking the sixth-consecutive record high.
Why is this important? Home prices are rising. This is both good news and bad news. The good news is that you will still gain equity from appreciation if you buy now or already own. Equity can be turned to cash to help pay off high interest debt, finance renovations, and more. The bad news is that if you continue to wait for rates to fall, you could be facing higher home prices in the future. You’ll also likely face higher home buyer competition, which can lead to bidding wars and even higher home prices. So, if rates are the only thing that are holding you back from buying right now, it might be worth exploring options like a payment buydown. Many builders and sellers are offering concessions that can help you buy today. You can also couple these offers with Rate Rebound, which lets you buy today and refinance to a lower rate if rates fall with no lender costs and a $1,000 credit*. It doesn’t expire once you use it – you can continue refinancing with no costs for up to five years after the purchase date (as long as rates continue to fall).
Interested in learning more? Reach out and we would be happy to talk!
*CMG Home Loans will cover all customary lender fees which are processing fee, administrative fee, tax service fee, appraisal fee and credit report fee. In addition CMG Home Loans will also credit the borrower up to $1,000 towards additional third-party fees. This offer does not cover discount points. Credit cannot exceed total fees. Rate Rebound is only valid on future conventional conforming, government, and jumbo loans in our retail channel (future Construction Loans, All in One, HELOCs, Bond or HFA loans are excluded). There may be additional restrictions based on investor. Offer may not be redeemed for cash or credit and is nontransferable. Offer cannot be retroactively applied to any loans. Offer may not be used with any other discounts, promotions or interest-only/buy-down and second lien products. This offer is subject to changes or cancellation at any time at the sole discretion of CMG Home Loans. Additional restrictions/conditions may apply. This is not a commitment to lend and is contingent on qualification per full underwriting guidelines. Program will be available on loans disclosed on or after 11/1/22. Program is applicable for refinances 6 months after closing up to 5 years from original note date and with a net tangible benefit which includes a rate reduction of 0.5%, going from an ARM to fixed rate, reducing loan term, movement to a more stable product, or a lower principal and interest payment. By refinancing the existing loan, the total finance charges may be higher over the life of the loan.