Monthly Mortgage Market Trends

September 5th, 2018 – As a proud member of DMAR’s Market Trends Committee, the Top Producer at Fairway Mortgage, and an owner of 19 investments, it pains me to see people sitting on the sidelines of the housing market due to fear. The news headlines of increased inventory, softening markets, and an impending doom of another housing crisis paralyze homebuyers and sellers. Understanding the DMAR market trends data and its insights allows us as professionals to support our clients in building multi-generational wealth instead of waiting for something that might or might not happen.

We have now seen the 4th straight month of increased housing inventory. In fact, month over month in August, we saw an increase of 7.65%. This is the highest month over month increase in all recorded time.  For comparison, the average month over month from July to August is -0.16%. National inventory is also starting to net positive as well. This is a great sign. NOT a time to worry about a recession that is not here. So, let’s talk about the recession… a recession does not mean a housing bust.  A recession is defined by two consecutive quarters of GDP decline and this recession will be, by all expert’s commentary, a geo-political recession.  And, in fact, it will be the housing market that pulls us out of it.  
  
What the increase in inventory does give us, however, is relief from the high appreciation values we’ve been experiencing for the last five years. Year-over-year appreciation of our median home prices dropped to 8%.  This is great news for our first-time homebuyers who have been priced out of the market. It’s also great news for anyone coming into the market as opportunities for home wealth continue to be abundant.   
  
With appreciation continued at more steady levels and interest rates on the rise again; now is the time to jump into the market. The Federal Reserve Board has been watching the Core Inflation Rate, which has now reached its 2% target. With that, the Federal Reserve no longer needs to hold back on raising interest rates, which is expected to happen this month and again in December. So, next year, that home will cost you 8% more and 0.5% to 1% more in interest.

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