Good news for guys like me who lend money for a living: CoreLogic reported that the percentage of all-cash home sales decreased 1.9% to 27.7% of total transactions (meaning that more people are getting loans to buy homes).  The number of existing homes that sold last month incidentally, is up 3.2% from last month.  That’s like a 5% pay raise this month if you’re a lender!

New York Federal Reserve Bank President William Dudley (“Do Right”) said that the Fed will raise interest rates later this year “if the economy stays on the current trajectory”.  Not feeling quite as confident, the European Central Bank is keeping their interest rates unchanged at 0.25% and will continue to purchase notes to keep other rates low as well.

Stocks are mixed, Bonds are flat.  Oh BTW, the Beige Book was blase: forty-six pages of “modest to moderate paces of expansion” and “tight labor conditions” language throughout the 12 tracked districts.  And on that note, I am heading up to the Homestead Resort for Fall Break with my family in a few hours.  I hope that you also get to enjoy some respite from the grind this weekend!


The Federal Housing Finance Agency shows that home prices rose 0.5% over the last monthly period, and 6.1% over the last 12 months.  Someone needs to tell that to appraisers, who assigned a value lower than the REPC price on four of my loans last Friday. So much for the spirit of giving.  Maybe it’s not a localized trend and that’s the reason why the number of Existing Home Sales dropped 10.5% last month.  Or maybe home buyers and their representatives have already checked out for the rest of the year like the Federal Reserve, who will not be making any more asset purcheses until 2016.

Trends in Home Sales

As Existing Home Sales ebb, New Home Sales are on the rise.  February saw an 8% uptick to 539,000 annualized units closed, which is 14% above expectations and represents roughly 10% of all homes sold last month.

The Consumer Price Index (which measures the relative cost that we retail suckers pay for our stuff) rose 0.2% last month, and 1.7% from last year–right in line with the Fed’s generalized inflationary goal for the year.

Mortgage Pricing on Wall Street continues upward, helping set the stage for lower interest rates ahead.

Friends without Benefits

New Home Sales surge by 18.6% last month to an annual rate of 504K, well above the 440K anticipated.  Still, according to the National Association of Home Builders, we haven’t been building this few homes since WWII.  Part of the reason is the there are over 2MM millennial “friends” (AKA YSA’s) who are choosing to stay home with Mom and Dad or shack up together in an apartment rather than purchase real estate.  This is leading to a generation ill-prepared for their financial future.

The Case Shiller 20 City Index shows home prices rose 10.8% since this time last year.  This is down from the 12.4% increase reported last month.  The median home price across the country is $213,400, averaging 47 days on the market.