Existing Home Sales rose almost 11% over the expected 3.95M units forecasted this week, and the number of newly constructed homes being started is increasing at the same rate.  As someone whose living is tied to the housing market, it’s nice to see home sales start to pick back up again. As someone who owns a home, it’s also nice to start to see more market velocity.

Along the Wasatch Front, our home values are up 5.8% from a year ago.  The latest nationwide consumer inflation reports show that shelter costs are 5.7% higher over the same period.  Interestingly, the nationwide Median Home Price dropped from $479,500 to $417,700 during the same time.  That’s partially because with rates and prices being higher than they were a few years back, lower priced homes represent a greater percentage of the homes being sold.  Frankly, that’s what people can afford right now.  The average sales price falling while shelter costs as a whole are rising is also a testament to the rapid increase of the cost of renting.

Switching gears, Switzerland’s Central Bank dropped their lending rate by 1/4% today.  They are the first major player to cut rates during our current expansion cycle.  Our own Fed left our rates unchanged this week, but their famed “dot plot” forecast as well as Chair Powell’s comments at the conclusion of the FOMC press conference on Wednesday confirm that they are still planning to cut rates three times this year. The odds are only 12.4% that the retraction cycle starts in May, and currently stands at 66% probability for a 0.25% cut on June 12th. By the July meeting. there’s only a 12.4% chance that rates haven’t dropped.

I acknowledge that this is the exact opposite of what you read from me last week. So goes the world we live in; never a dull moment.