Issue 49. November 6th, 2023

Happy Monday💸 Sorry for the delay. Technical issues this morning, classic Monday.

The word has been out now for a few days. Rates had a huge move downward over the back half of last week. Buyers are being shown revised scenarios, and although a rate with a 7 is still not ideal, it is a hell of a lot more enticing than the 8’s we were putting up with.

Could this be the jump start we need?

Buyers and sellers could see this opportunity vaporize tomorrow, hover here the rest of the year, and hell, it could be the start of a rally right into a mini refi boom. 🔮 NOBODY KNOWS. I will continue to beat this dead horse – If you can afford the payment, and it makes sense for you, buy the house.

Seinfeld / 1991 – NBC

🧑‍⚖️ What is the deal (Seinfeld voice) with this whole NAR lawsuit about collusion? I know there are some morally questionable people in all phases of this business, but I was shocked when I read that the suit was collusion.

From the outside looking in, it seems like some lawyers are looking for a payday via a class-action suit. One of these deals where the Plaintiff didn’t know they should be “outraged” until an attorney explained it to them. But hey, it’s only how this business is done nationwide and for over 100 years.

Idk, maybe time for a change, but this seems like it will do more harm than anything. A total shit show if you ask me. This will likely get tied up for years with appeals.

What are your Brokers saying about all of this?

🪖 See you in the trenches.

– Glenn T. Groves

TLDR (Too Long Didn’t Read) Summary:

• ⬇️ RATES – Big moves.

• 📊 TECHNICALS – Job market sputtering. Homes appreciating.

• 📰 INDUSTRY – NAR Case, 4% Rate Locks, Commerical Woes.

  Verify my mortgage eligibility (Dec 5th, 2023)

RATES
➡️ NOVEMBER 6TH, 2023

Jurassic Park / 1993 – Universal Pictures

Product Rate / APR Weekly Change

⬇️ Conventional (Zero Point) 7.500% / 7.515% -.500%

Conventional (One Point) 7.125% / 7.223%

⬇️ Conv. HB (Zero Point) 7.750% / 7.762% -.500%

Conv. HB (One Point) 7.375% / 7.494%

⬇️ JUMBO (Zero Point) 7.625% / 7.667% -.250%

JUMBO (One Point) 7.250% / 7.402%

⬇️ FHA 3.5% Down (Zero Point) 6.750% / 7.484% –.500%

FHA 3.5% Down (One Point) 6.375% / 7.196%

⬇️ VA 0% Down (Zero Point) 6.750% / 7.029% –.625%

VA 0% Down (One Point) 6.500% / 6.874%

Rate data as of morning of publication. Unless noted otherwise, all scenarios are assuming 30 Year Fixed mortgage, Purchase & R/T Refinance. No origination points charged, 780 FICO score, and 20% down payment .Provided for consumer education only and does not serve as a binding offer to extend lending. Payment period, interest rate, APR, and other terms subject to income, asset, and credit profile qualification.

Rates highlighted in this color have the same metrics as above, but would incur one discount point charge.

*NEW* Debt Consolidation Options

↔️ FIXED 2nd (Zero Point) 10.000% / 10.044% –.250%

FIXED 2nd (One Point) 9.625% / 9.801%

Rate data as of morning of publication. Unless noted otherwise, above scenario are assuming 30 Year Fixed, Closed End 2nd mortgage, Cash Out Refinance. No origination points charged, 780 FICO score, 60% CLTV .Provided for consumer education only and does not serve as a binding offer to extend lending. Payment period, interest rate, APR, and other terms subject to income, asset, and credit profile qualification.

Rates highlighted in this color have the same metrics as above, but would incur one discount point charge.

• 📊 Mortgage Rates: 6’s and 7’s. What a sight for sore eyes.Massive Wednesday – Friday drop had us hovering slightly lower (.125% lower) than today’s rates. Huge movement.

TECHNICALS

Housing Highs & Labor Lows

We’re still dredging through a very murky news cycle. Everything is and will continue to point towards the fact that we are indeed in a recession. Don’t worry. You and I feel it daily. At the gas pump, at the grocery store, and unfortunately, on our Proft and Loss statements.

When will the American consumer hit the wall? When will the spending tighten? We might be seeing the beginning of what might actually be considered a recession… and then later will be classified as, “Hey, this recession started 8 months ago” or something similar to that, lol.

Hang in there!

📉 Lower Job Numbers: A Reality Check?

• October Jobs: 150,000 vs. 180,000 expected.
• Unemployment Rate: Slight increase from 3.8% to 3.9%.
• Business Survey vs. Household Survey: The former is a model estimate; the latter is a real-time measure, showing 348,000 job losses.
• Work Hours: Declined slightly, equivalent to 2 million job losses when scaled up.

🔍 Bottom Line: The job market may not be as robust as previously thought, signaling caution for prospective buyers and sellers.

🔴 Private Payrolls Miss the Mark

• ADP Report: Only 113,000 jobs added in October.
• Wage
  Growth: Slowest in two years, signaling easing inflation pressures.

🔍 Bottom Line: Consumer spending remains strong, but the growth in pay has cooled, potentially affecting buyer affordability.

🏢 “JOLT” in Job Openings

• Job Openings: Slight increase to 9.55 million.
• Hiring and Quit Rates: Unchanged, hinting at a stable yet cautious job market.

🔍 Bottom Line: The rise in job openings may be overstated due to remote work listings, suggesting the labor market might not be as tight as it appears.

📈 Continuing Jobless Claims at a 6-Month Peak

• Initial Claims: Rose by 5,000 recently.
• Continuing Claims: 1.82 million people still receiving benefits.

🔍 Bottom Line: Difficulty in finding new employment post-layoff could impact market confidence.

🛑 Fed Puts Brakes on Rate Hikes – For Now

• Federal Funds Rate: Held steady at 5.25% – 5.5%.
• Future Hikes: Possible, with the labor market’s condition being a determinant.

🔍 Bottom Line: Mortgage rates could see a respite, but uncertainty prevails; buyers and sellers should stay informed of upcoming decisions.

🏠 Home Prices: Still Climbing

• Case-Shiller Index: Up 0.9% from July to August.
• FHFA
  Index: Increased by 0.6% in August.

🔍 Bottom Line: With home values reaching new highs, the market offers a strong opportunity for wealth building through homeownership.

🔭 Looking Ahead

• Housing Data: CoreLogic’s Home Price Index for September due Tuesday.
• Jobless Claims: New data coming Thursday.
• Investor Watch: Demand in upcoming 10-year Note and 30-year Bond auctions.

📈 Technical Picture

• 10-year Yield: Ended last week around 4.57%.

Please note, all data is sourced from respective official reports and news as of the latest available figures.

🔗 Sources & Further Reading:

• Bureau of Labor Statistics (BLS) Jobs Report for October: BLS October Jobs Report
• ADP National Employment Report for October: ADP Employment Report
• Job Openings and Labor Turnover Survey (JOLTS) for
  September: JOLTS September Summary and JOLTS Report
• Federal Reserve’s Federal Open Market Committee (FOMC) Meeting Statement from November 1, 2023: FOMC Meeting Statement, Implementation Note, and Press Conference Transcript
• S&P/Case-Shiller U.S. National Home Price Index for August: Case-Shiller Home Price Index, with the suggested citation here
• Federal Housing Finance Agency (FHFA) House Price Index for August: FHFA House Price Index

INDUSTRY

What Else Is Happening?

• 🏠💸 Commission Collusion Verdict: NAR and leading realty firms face a staggering $1.78B penalty for commission rate collusion. Potential treble damages could skyrocket liabilities. Details here

• 💔 Mortgage Rate Lock: Homeowners cling to sub-4% rates, stalling sales to a 12-year low. Buyers and sellers are in a holding pattern. Insights

• 🏡 Vacancy Rates Inch Up: Rental vacancies rise to 6.6% nationally, a slight increase from last quarter’s 6%. Census update

  Verify my mortgage eligibility (Dec 5th, 2023)

• 📉 CBRE Profit Dip: A tough real estate market leads CBRE to cut costs as profits fall by 56%. More info

• 📈🎢 Dow’s Strong Rebound: Despite tepid job growth, the stock market experiences its best week since last fall. MarketWatch

Created by Glenn Groves

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