Real Estate & Market Report: April 12, 2013
BY FRED ARNOLD
Joke: A new business was opening and one of the owners friends wanted to send flowers for the occasion. They arrived at the new business site and the owner read the card; it said "Rest in Peace". The owner was angry and called the florist to complain. After he had told the florist of the obvious mistake and how angry he was ,the florist said. "Sir, Im really sorry for the mistake, but rather than getting angry you should imagine this: somewhere there is a funeral taking place today, and they have flowers with a note saying, "Congratulations on your new location."
The stock market this week has continued its recent consistent pattern of hitting new record highs. The pattern has lasted since last week and had been gaining momentum almost daily however on Friday it is possible the rising pattern may take a breather.
The stock market futures as of Friday morning are in negative territory primarily based upon news that Cyprus, (yes that little known country that created market chaos last month) has indicated that they will need more money for the bailout. I personally do not understand why the markets would be concerned over this news for two simple reasons.
First history has taught us that bailouts always require more money than additionally requested. Second, they will get the money because the banking system will not be allowed to fail in Cyprus. These types of events have become normal operating procedure for every country that has faced a financial crisis in the last 3 years.
On Wednesday the FOMC minutes were released and gave additional support for the stock market rally. Most members of the FOMC feel that the QE3 stimulus program is working and indicated that they are not ready to pull back on it.
Mortgage rates had been declining for about a week, and although they are not back to historic levels, they certainly have stimulated more refinances. The Mortgage Bankers Association reported that refinances for the prior week jumped 6%. Purchase applications unfortunately continue to remain stagnant. Most experts believe that the cause is not so much related to interest rates, but more so impacted by so many markets around the country having a shortage of inventory for sale.
The good news relating to the housing market is that in the last week the main stream media has significantly increased their reports on the improving housing market. Like with everything else the media impacts, the media can create movement in the housing market because the more they report on positive events and data, the more consumers will respond to take advantage of the rising home prices.
For those of you in the mortgage profession, real estate profession, or homeowner thinking of selling, the market has heated up! We have many positive things happening simultaneously. Housing reports are showing significant improvement in property values, the media is helping fuel housing demand, and we are entering the Spring selling season. All of these factors together stand to push housing to higher levels as it is more and more likely that sellers that have been waiting will now start to place their homes for sale on the market.
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The economic calendar for next week will provide some potential market movers :
- Tuesday April 16th - Consumer Price Index, Housing Starts and Industrial Production
- Wednesday April 17th - MBA Purchase Applications
- Thursday April 18th - First Time Jobless Claims and GDP
As your mortgage professional, I am happy to assist you with any information you may need regarding mortgage or real estate information. I welcome the opportunity to seve you in any way I possibly can. Please feel free to reach me at (661) 505-4300