Thursday, November 6, 2014

Thursday Real Estate and Mortgage News

Inventory shrinks slightly and prices climb as the home buying frenzy continues

The fall home buying season began with gusto in Houston as sales and prices did in September what they have done for months – rose. The continued buying frenzy caused housing inventory to shrink very slightly after holding steady at a 3.0-months supply for two consecutive months. And in another scenario that has become all too familiar in this market, prices reached record one-month highs.
According to the latest monthly report prepared by the Houston Association of REALTORS® (HAR), single-family home sales totaled 6,490 units, an increase of 7.0 percent compared to September 2013. Months of inventory, an estimate of the time required to deplete the current active housing inventory based on the previous 12 months of sales activity, dipped to a 2.9-months supply from a 3.2-months supply last September. It remains well below the current national supply of 5.5 months of inventory.
The average price of a single-family home jumped 8.2 percent year-over-year to $269,440. The median price—the figure at which half the homes sold for more and half for less—rose 7.7 percent to $196,000.
September sales of all property types totaled 7,879 units, a 7.0-percent increase compared to the same month last year. Total dollar volume for properties sold soared 15.7 percent to $2 billion versus $1.7 billion a year earlier.
“As long as consumers continue to snap up homes at the current pace, replenishing our housing inventory will be a slow process,” said HAR Chair Chaille Ralph with Heritage Texas Properties. “Rental numbers were strong in September, suggesting that many would-be home buyers are continuing to go the lease route until the market bears the homes they’re looking for at the price point that suits them.”
September Monthly Market Comparison
The Houston housing market experienced across-the-board gains in September, with total property sales, total dollar volume and average and median pricing all up when compared to September 2013.
Month-end pending sales for all property types totaled 4,143. That is up 17.2 percent compared to last year and is considered a bellwether of continued positive sales activity next month. Active listings, or the number of available properties, at the end of September was 28,946 and is 10.8 percent below last year.
Houston’s housing inventory, after holding steady at a 3.0-months supply in July and August, shrank in September to a 2.9-months supply versus 3.2 months a year earlier. That compares to a 5.5-months supply of inventory across the U.S. recently reported by the National Association of REALTORS®.
Single-Family Homes Update
September single-family home sales totaled 6,490, up 7.0 percent from September 2013.

Not a good start this morning in the bond and MBS markets ahead of tomorrow’s employment data. Prior to 8:3 the 10 traded unchanged and the open in MBS trading started with the price for 30 yr Fannie’s up 8 bps. Weekly claims and Q3 data at 8:30 turned the rate markets to unchanged. Weekly claims at 8:30 declined 10K from last week to the lowest we have seen in a very long time, at 278K; the expectations were for 283K. The four-week moving average, a less-volatile measure of job cuts, reached the lowest level in more than 14 years; to 279,000, the lowest since April 2000, from 281,250

Yesterday’s elections will remain a hot topic for the rest of the Congressional session but after the initial assessments yesterday today quiet. The President held his ‘mandatory press conference’ after the results talked the talk as did Mitch McConnell the new Senate majority leader; will they walk the walk?

All of our technical indicators, chart patterns and models are now bearish. There is a very significant channel that has developed over the past couple of weeks. Trading channels are significant for us; especially this one that so is holding very well from highs to lows. Today expect little change ahead of employment tomorrow morning. 

Stay tuned and stay focused!

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