Traditionally, the spread between 10-year rates and mortgage rates is 1.60%-1.80%. Currently, the difference between them is 2.60%. However, that compares with last year’s worst levels, when spreads were as high as 3.10%. There is a 0.50% difference in rates.
The rest of the year is all about the labor market. The bond market has tried three times to respond to a recession or weak economic data by pushing down long-term yields, but was rebuffed each time because labor data failed to break through. So keep an eye on the weekly jobless claims data as well as any employment reports due at the end of the month. You can find the latest updates to this profile here.
Purchase application data
Purchase application data is showing a positive trend each week, but is still down from the same period last year. We’re seeing better positive sales growth in the weekly pending sales data. Part of this may be due to a higher proportion of cash buyers in the sales mix, which buying apps don’t account for. Additionally, purchasing app data can sometimes be a funky data line to track percentages. I’ll be discussing this on Monday’s HousingWire Daily podcast.
Since mortgage rates began to fall in November 2023, we have 12 positive photos relatively nine negatives and Two flat prints weekly.So far this year we have six feature films, Nine negative and Two flat prints.
Weekly housing inventory data
Last week was another missed week with my stock growth model, with higher rates. When the ratio exceeds 7.25%, I always want weekly inventory growth to be between 11,000 and 17,000. Interest rates have fallen recently, and inventory growth last week was higher than the week before.However, I would expect more impact than stock increases 8,727 We got it. So, we’ll see what next week looks like. Let’s remember, this weekend is Mother’s Day weekend. Next week, inventories should surpass last year’s highs.
- Weekly inventory changes (May 3 to May 10): Inventories rising 559,744 arrive 568,471
- Same week last year (May 5-May 12): Inventory rises 420,489 arrive 421,101
- Historical inventory bottom occurs in 2022 240,194
- The inventory peak in 2023 is 569,898
- For some cases, this week’s active list is at 2015 yes 1,109,727
New listing data
One of the most encouraging housing developments in 2024 is the annual growth in new listings, in stark contrast to 2023. This is a significant shift considering that 2023 is the lowest level on record. The fact that the data is currently positive is a very promising sign for the housing market. Although this year’s growth rate was slightly lower than expected, it is still a step in the right direction. Despite the decline over the past week, we are still maintaining positive year-over-year growth.
Here are last week’s new listings data for the past few years:
- 2024: 68,843
- 2023: 61,911
- 2022: 73,107
Price reduction percentage
On average, one in three homes loses price every year—standard housing activity. When mortgage rates rise, demand falls and the price reduction percentage increases. When interest rates fall and demand improves, this percentage declines.
As inventory increases, the proportion of price reductions increases year by year. The slope of the curve in 2024 is much slower than what we saw in 2022.They are no longer crashing, so the price reduction percentage data is moving a little slower than it did back then, but it is increasing year over year
- 2024: 33.7%
- 2023: 30%
- 2022: 21%
The week ahead: Inflation week and housing starts
It’s that time again: It’s inflation week again, with the Consumer Price Index (CPI) and Producer Price Index (PPI) inflation reports about to be released. Of course, some inflation reports have disappointed investors. United States Federal Reserve, so we’ll be keeping a close eye on the key numbers in these reports. We also have housing starts data, which is critical for the labor market as 5-unit permits have been in recession for some time. I’d like to see what the apartment completion data looks like because once these apartments are under construction, there’s a risk to the workforce. Tracking construction workers through each economic cycle is critical as we closely follow the direction of labor data and mortgage rates.
