Real Estate & Market Report: February 14, 2014
Let me start with a special Valentine's Day wish to you. Today is a day that I hope you are able to spend with that special someone in your life. Whether it is your one true love, your best friend, a parent, your children or that person that you have a very special relationship with, I wish you a day of enjoyment and love.
Even though today is Valentine's Day, for those of you living in the Northeast and Mid-Atlantic states, I imagine that the one thing you may not love today is Mother Nature. Once again, these regions have been pounded with snow and ice and travel has been nothing short of treacherous.
Next week there will be a number of real estate activity reports released, however they will likely not tell the real story of what is happening in the market. The reality of real estate activity today will come out in about 30 days and the numbers are likely to be rather deflating.
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The abnormally cold and snowy weather in the east, combined with the extensive drought-taking place here in California, are likely to have a significant negative impact on real estate markets. No one yet is really making any predictions on the numbers that will be released, but the reports are not expected to show signs of an improving real estate market.
As of Friday morning, the stock market begins the day 252 points higher than the beginning of the week. There has been market volatility throughout the week. On Tuesday investors were excited about Janet Yellen's, comments that she strongly supports current monetary policy.
The intention is to keep the current plan for stimulus tapering in place as long as the labor market continues to recover. Ms. Yellen's comments indicate a willingness to adapt monetary policy to changes in the direction of the recovery. The Fed continues to demonstrate a flexible approach to economic policy and that has investors optimistic.
Mortgage rates have increased off their recent declines related to uncertainty in the global markets and worse than expected corporate profit reports. You may remember that last week there were repeated reports about a global economic slowdown occurring in Asia. Combined with weaker than expected corporate profit reports, investors fled the stock market to place their money in the safe haven of government bonds driving down mortgage rates.
On the first day, God created the dog and said, "Sit all day by the door of your house and bark at anyone who comes in or walks past. For this I will give you a life span of twenty years." The dog said, "That's a long time to be barking. How about only ten years and I'll give you back the other ten?"
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And God said that it was good.
On the second day, God created the monkey and said, "Entertain people, do tricks, and make them laugh. For this, I'll give you a twenty-year life span."
The monkey said, "Monkey tricks for twenty years? That's a pretty long time to perform. How about I give you back ten like the dog did?"
And God again said that it was good.
On the third day, God created the cow and said, "You must go into the field with the farmer all day long and suffer under the sun, have calves and give milk to support the farmer's family. For this, I will give you a life span of sixty years."
The cow said, "That's kind of a tough life you want me to live for sixty years. How about twenty and I'll give back the other forty?"
And God agreed it was good.
On the fourth day, God created humans and said, "Eat, sleep, play, marry and enjoy your life. For this, I'll give you twenty years."
But the human said, "Only twenty years? Could you possibly give me my twenty, the forty the cow gave back, the ten the monkey gave back, and the ten the dog gave back; that makes eighty, okay?"
"Okay," said God, "You asked for it."
So that is why for our first twenty years, we eat, sleep, play and enjoy ourselves. For the next forty years, we slave in the sun to support our family. For the next ten years, we do monkey tricks to entertain the grandchildren. And for the last ten years, we sit on the front porch and bark at everyone.
Next week there is many economic data to be released, which is likely to contribute to market volatility.
- Monday February 17th - Presidents Day 2013 All Markets Closed
- Tuesday February 18th - Housing Market Index
- Wednesday February 19th - MBA Purchase Applications, Housing Starts, Producer Price Index and Federal Open Market Committee Minutes
- Thursday February 20th - First Time Jobless Claims and Consumer Price Index
- Friday February 21st - Existing Home Sales
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 serve you in any way I possibly can, (661)505-4300.