Housing data double-dip: Existing home sales, mortgage demand
Main U.S. indexes little changed; Nasdaq slightly green
Tech leads S&P 500 sector gainers; Energy down most
Euro STOXX 600 index off ~0.4%
Dollar, bitcoin rise; crude down, gold falls >1%
U.S. 10-Year Treasury yield edges up to ~4.42%
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com
HOUSING DATA DOUBLE-DIP: EXISTING HOME SALES, MORTGAGE DEMAND
To sum it up: mortgage rates are inching down, housing supply is edging up, but potential buyers still aren't biting.
Sales of pre-owned U.S. homes USEHS=ECI unexpectedly decreased by 1.9% in April to 4.14 million units at a seasonally adjusted annualized rate (SAAR), according to the National Association of Realtors (NAR).
The number landed 1.7% below consensus and follows an upward revision to the March figure, to 4.22 mln SAAR from 4.19 mln SAAR.
"Since the vast majority of homeowners locked in mortgage rates below 4% from 2020-to-21, moving home is prohibitively expensive for many people," writes Oliver Allen, senior U.S. economist at Oxford Economics. "This is limiting the supply of existing homes coming onto the market."
The sales rate decline gave a small boost to supply. At current rates, it would take 3.5 months to sell every available home on the market, up from 3.2 months in March.
"Sales still look a little elevated relative to the overall level of mortgage demand, and demand is unlikely to rebound in the near term, given that mortgage rates remain so high," Allen adds.
Speaking of which, mortgage rates dipped last week, provoking a jump in refi demand, according to the Mortgage Bankers Association (MBA).
The average 30-year fixed contract rate USMG=ECI shed 7 basis points to 7.01%, the lowest level in a month.
While that did not impress potential homebuyers, it sparked a refi rally; applications for loans to purchase homes USMGPI=ECI dipped by 1.2%, in fact, But demand for loans to refinance existing mortgages USMGR=ECI surged 7.4%.
"Purchase activity continues to lag despite this recent decline in rates ... as potential buyers still face limited for-sale inventory and high list prices," said Joel Kan, MBA’s deputy chief economist.
Mortgage rates are 32 basis points hotter than they were in the same week last year, while refi demand is up 21.2% in the last 12 months.
But applications for loans to buy homes - considered one of the most leading housing indicators - are down 11.6% over the same time period.
(Stephen Culp)
*****
FOR WEDNESDAY'S EARLIER LIVE MARKER POSTS:
NAIL BITING AHEAD OF NVIDIA'S NUMBERS - CLICK HERE
WALL STREET INDEXES STAY CLOSE TO UNCHANGED - CLICK HERE
BENCHMARK TREASURY YIELD PUSHES HIGHER AHEAD OF FED MINUTES - CLICK HERE
SERVICES TO BLAME AS UK INFLATION STAYS HOT - CLICK HERE
UTILITIES: WHAT A DIFFERENCE A MONTH MAKES! - CLICK HERE
BANKS: WHEN RATE CUTS COME, SO WILL PROFIT-TAKING - CLICK HERE
WHY US YIELDS CAN GO BACK TO RECENT HIGHS... OR BEYOND - CLICK HERE
STOXX STUMBLES AS AUTOS DRAG - CLICK HERE
STOXX FUTURES FLAT AS FTSE LAGS POST-CPI - CLICK HERE
NVIDIA VIGIL ALMOST OVER - CLICK HERE
Existing home sales https://reut.rs/3V9H4S9
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
