Wednesday, March 30, 2016

Stock Market Craziness

The stock market craziness has calmed down and investors seem to have taken a little bit of a breather.  Through the first 4 trading days of the week the markets have remained within a narrow range.  With little major economic news domestically and internationally, there has been little opportunity for investors to jump on and try to take advantage of.

Overall the stock market continues to remain in “bull” territory with 5 straight weeks of market gains.  At this point all the losses that were incurred since the fall of last year and through the beginning of this year have been returned.

Oil prices have been rising and now sit at just under $40 a barrel.  This is a significant jump from just a few weeks ago where the price for a barrel was as low as $26.00.  With current oil prices stemming the tide of company bankruptcy’s, investors continue to feel much better about corporate profits which is what is keeping the stock market rally going.

The housing market seems to be lagging behind the growth of other sectors of the economy.  Existing home sales for the month of February unexpectedly declined by a surprising 7.1 percent.  The single family sector of the report represented a significant portion of the decline.  The biggest contributor to the decline is not the lack of demand, it is the shortage of available inventory.

Current supply of homes available for sale is at 4.4 months. Although this is an increase from the prior month’s 4.0 month, this is still far below the 6 month supply level which is considered a healthy balanced market.  Existing home sales are currently 2.2 percent higher than the same time last year.  Although inventory is higher, the trend of sales overall may be heading in the wrong direction due to the shortage.

Despite challenges to the housing sector, there are some bright spots.  The FHFA House Price Index showed home prices continue to rise with an increase of 0.5 percent from December to January.  Additionally, prices are 6.0 percent higher than the same time last year.  One of the thoughts on the shortage of inventory is that home owners are holding on to their properties to ride the wave of rising home values.

Finally, a burst of strength in the West for new home sales created a 2.0 percent increase in national sales of new homes for the month of February.  Sales in the West jumped a whopping 39 percent which was a reversal from the prior month’s decline of 33 percent.  The West always plays a major role in the data for this report as the West is the largest market for new construction.

This week’s potential market moving reports are:

·        Wednesday March 30th – ADP Employment Report, MBA Applications & EIA Petroleum Status
·        Thursday March 31st - First Time Jobless Claims & Durable Goods Orders
·        Friday April 1st – Employment Situation, ISM Manufacturing Index &Construction Spending
As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends.  I welcome the opportunity to serve you in any way I possibly can.  Please feel free to reach me at (707) 455-7070.

Sunday, March 27, 2016

How To Make Cadbury Creme Eggs

Ingredients: (the filling should make about 16 complete eggs, I made 8 and had heaps left over)

Milk or dark chocolate for melting (for the 8 I made, I used about 250g)
1 1/2 cups of icing sugar
1/8 cup of butter
1/4 cup of glucose
1 teaspoon of vanilla
Yellow/orange food coloring

NOTE: If you do not want to buy the egg molds (the ones I bought were only $4 each), you can leave the filling more like a paste without adding the water. Roll the yolks into balls then encase them with the white mixture. Roll them into egg shapes, then dip them in chocolate.

Thursday, March 24, 2016

Buying A House - Old Vs New

Are you contemplating buying a house? If a real estate purchase is high on your list of priorities in the near future you might be asking yourself; should I buy a new house or an older house? That's not necessarily as simple a question to answer as you might think, there are a lot of factors to consider when purchasing a home, new or old. As an experienced realtor I'd like to offer a little advice to help you understand some of the differences between the two.

Most people have a picture in mind when they imagine what their house should look like. You might dream of curling up in front of a big wood-burning fireplace in a grand old heritage house on a cold winter day. Hopefully your partner isn't dreaming about gazing out at sparkling city lights from a brand new penthouse condo! Having similar tastes in real estate is really helpful when your property search begins.

Regardless of what type of house you end up buying you will likely discover that home ownership is very rewarding, bringing you and your family a sense of security, confidence and comfort. In today's real estate market, incentive programs, low interest rates and a surfeit of available properties make home ownership an attainable goal for many.

Your house selection will be determined by a number of factors including the need for space (lots of kids or pets?), your desired location and of course your budget. It's pretty much always a matter of compromise. You may find an old house with the character you adore that needs a ton of renovation, but if it doesn't fit into your budget or you can't do the work yourself it just might not be a good choice. Likewise, you might have your heart set on a new house, but keep in mind that you may need to spend more money on things like window coverings, landscaping and fencing that are often already included with an old house.

Benefits of Buying an Older House

In general, buying an old house means you can see what you are getting - any major structural faults will have become apparent over time (and hopefully been corrected!). The neighborhood is likely well established so you know what you're getting there too. You will often find lovely mature landscaping that offers more privacy than in a new neighborhood. The house will probably come with basic chattels such as drapes, blinds and light fixtures, and may also offer appliances, saving on after purchase costs.

Benefits of Buying a New House

If you decide to buy a new house you might be able to have a hand in customizing the finishings (flooring, paint, even cabinets and countertops). If you are having a custom house built for you there is no limit (except maybe budgetary) to the choices you can make, starting with the basic design of the house. New homes usually have much more storage space and bigger rooms, as well as being plumbed and wired for all the latest gadgets and technology (home theatre anyone?). Usually, land values increase as the neighborhood develops so you may gain equity if you build in a new subdivision as it nears completion.

Whether you end up buying an old house or a new house depends on you, but discussing your inclinations with your realtor can help you come to an informed decision about the types of properties you want to look at. An experienced realtor can guide you through the entire home buying process so that you find the home that best suits you and your family.

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Monday, March 21, 2016

What A Difference

What a difference a few weeks makes.  The Dow Jones Industrial Average has recouped the over 2000 point loss from late last year.  Oil prices are now at $40.00 a barrel and rising.  This is what is primarily fueling the stock recovery.

Just a short time ago everyone was expecting the Fed to raise interest rates at the March meeting.  On Wednesday the Fed announced they were leaving interest rates alone.  Additionally, they indicated that instead of the expected four planned rate increases for 2016, there will likely only be two of them based on current trends.

In January the Fed’s assessment of the economy was labeled as “solid”.  Today’s announcement showed a change in sentiment as the Fed statement now uses the word “moderate”.  Additionally, they also modified their sentiment on business investment from “advancing” down to “soft”.  The positive in the Fed report is that they continue to use the word “strong” to describe the labor market.

The report on housing starts was mixed with starts way up, however permits are way down.  Starts rose 5.2 percent for the month of February.  Permits, which are an indication of market direction, declined 3.1 percent.  The starts for single family homes were up 7.2 percent and the permits for this sector were up 0.4 percent.  The weakness in the report was mostly centered on multi-family construction.

With mortgage rates creeping up slightly, the impact was felt in refinance applications according to the Mortgage Bankers Association of America.  The MBA reported that for the week ending March 11th applications for refinances declined 6.0 percent.  Applications for purchases rose 0.3 percent.

The housing market index is showing that demand for new homes is solid.  A lack of available lots for building is continuing to hold back construction growth.  The housing market index came remained unchanged but still indicates a relatively strong market.

First time jobless claims continue to remain at a very low level confirming the health of the labor market.  Initial claims rose slightly from a revised 258,000 up to 265,000.

Inflation on the wholesale level continue to remain soft.  It seems that most attempts to raise prices in this sector are being met with great resistance.  Prices for consumer are rising slightly.  The Fed’s target rate of 2 percent annual inflation is still not being met, but overall prices appear to be rising.  The fact that inflation has been remaining stable is a key reason for the Fed keeping rates where they are.

Next week week’s potential market moving reports are:

·        Monday March 21st – Existing Home Sales
·        Tuesday March 22nd – FHFA House Price Index
·        Wednesday March 23rd - MBA Applications & New Home Sales
·        Thursday March 24h - First Time Jobless Claims & Durable Goods Orders
·        Friday March 25th – GDP

As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends.  I welcome the opportunity to serve you in any way I possibly can.  Please feel free to reach me at (707) 455-7070.

Sunday, March 13, 2016

Market Calming Can Be A Good Thing

With a lack of economic data this week, both domestically and internationally, there has been little for the stock market to act upon.  The week has seen the market trading in a fairly narrow margin which has given investors a little bit of a breather.  Of course movements in the market is where the greatest opportunities exist however every so often a market calming can be a good thing.

The biggest factor driving the markets has been the stabilizing and rebound in oil prices.  A barrel of crude oil now sits at just under $39 a barrel.  This is up 50% from February’s low of $26.  Many analysts, for what their opinion is worth, believe that oil prices are likely to be sitting at the bottom at this time.
OPEC and Russia seem to be working on an agreement to curtail some production of oil to continue in keeping prices stable.

Many people have been asking me in response to my previous commentary in the newsletter as to why low oil prices are such a problem for the national and international markets?  The simple answer is that with oil priced at such a low point as we were before, oil companies cannot remain profitable.  Even during the brief decline in prices, hundreds of energy companies filed for bankruptcy.

The bottom line is that energy companies, big and small, not only are traded in the stock markets, they make up a significant portion of market value.  With so many companies in the markets losing money, and or going bankrupt, it had the ability to take down the markets.  (Remember the housing crisis and how the banking industry almost went bankrupt…this is a similar scenario).  Fortunately, it seems that that storm has passed globally and the markets have stabilized.

The Mortgage Bankers Association reported this week that purchase applications rose 4.0 percent.  Refinance applications declined 2.0 percent.  Despite a strong mortgage market, home sales in general continue to remain flat.  Lack of inventory is the main culprit in keeping overall purchase volume down.  Despite the pent up demand, home appreciation is not out of control as we have seen in other low inventory markets in the past.  Next week there are a number of housing reports due out.

The job market continues to remain very strong.  Last week’s mostly positive employment report was followed this week with another strong jobless claims report.  First time claims are down to 250K which was far below most analyst’s expectations.  Anything below 300k is considered very optimistic for the labor markets.  There were no special factors attributed to the lower than expected number which indicates that this is a real trend and not based on any special circumstances.

Next week we make up for the lack of reports this week:

·        Tuesday March 15th – Producer Price Index, Retail Sales, Housing Market Index
·        Wednesday March 16th - MBA Applications, Consumer Price Index, Housing Starts, FOMC
     Meeting, Industrial Production, FOMC Forecast
·        Thursday March 17th - First Time Jobless Claims
·        Friday March 18th – Consumer Price Index

As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends.  I welcome the opportunity to serve you in any way I possibly can.  Please feel free to reach me at (707) 455-7070.

Wednesday, March 9, 2016

Sunday, March 6, 2016

It Seems....

It seems like investors are back in the stock market.  This is the second week that the broader indexes finished in positive territory.  As of Friday morning that Dow is up just under 300 points for the week.

The biggest economic news for the week was the Labor Department’s Employment Report.  The headline showed that the market added a very strong 242,000 jobs in the month of February.  This number far exceeded the highest expectations of only 217,000.  To add strength to the report, the prior two month’s positive employment numbers had upward revisions of a combined 30,000.

In early trading the stock market is down about 45 points.  Where it would normally be that the better than expected jobs report should create a market rally, there is a negative aspect of the employment report that seems to have investors concerned.

The labor department’s report showed a 0.1 percent decline in hourly earnings.  This decline is in the opposite direction of January’s 0.5 percent increase.  Additional concern in the labor data is that year-on-year earnings are down 2.2 percent.  To add to the sentiment that the report is not as strong as the headline indicates is that there was a slight drop in workweek hours.

To remain positive, it is important to realize that the overall the increase in jobs, and the fact that the unemployment rate remained unchanged at 4.9 percent, is cause for optimism towards future economic growth.

The pending home sales index surprised many people in that the sales of existing homes were down in January by an unexpected 2.5 percent.  Analysts were anticipating an increase of 0.5 percent.  December’s numbers were revised upward by 0.8 percent showing a total increase of 0.9 percent.  Some experts are predicting that when January’s revision comes out next month, there will likely be an upward revision to this week’s report.  Compared the same time last year pending home sales are higher by 1.4 percent.

Over the last couple of week’s mortgage rates have been ticking upward.  Although they remain near historic lows, none the less applications for refinances will always be very sensitive to interest rate movements.  The Mortgage Bankers Association reported that for the last full week of February applications for purchases and refinances declined 1.0 percent and 7.0 percent respectively.

As mortgage rates likely continue to inch up, it is probable that the refinance numbers will continue to decline.  Purchase applications are not impacted the same way with interest rate movements.  Good news for the housing market is that many real estate and mortgage professionals have reported a significant uptick in purchase activity in the last week.

Next week there are very few potential market moving reports:

·        Wednesday March 9th - MBA Applications & EIA Petroleum Status
·        Thursday March 10th - First Time Jobless Claims

As your mortgage and real estate professional, I am happy to assist you with any information you may need regarding mortgage or real estate trends.  I welcome the opportunity to serve you in any way I possibly can.  Please feel free to reach me at (707) 455-7070.

Thursday, March 3, 2016

What A Mortgage Lending Professional Can Offer

Buying a home is one of the most crucial decisions you will make in your life. After considering a range of important aspects you must then take the steps necessary to buy the home. This is as important as the home itself and will affect you for many years to come. Getting a mortgage is a great step most people take when buying a house. There are a lot of reasons people choose to get a mortgage-it allows them to make the decision to own a home soon rather than waiting years to save. With a mortgage you can pay for your home over a period of time instead of digging deep into your savings all at once. Mortgages are a safe and easy way to become a home owner.

Before you make the leap to get a mortgage you must find a reliable mortgage company. As stated previously, this is such an important decision that it will have an influence on your life for many many years to come. It is wise to make sure that you work with a mortgage firm that you can really trust and depend on to get you the best mortgage that will suit you well. There are a lot of mortgage firms that don't take care of their customers properly or meet all of their needs-but with our mortgage firm you don't have to worry about any of that.

Mortgage firms understand that buying a new home is a very important step in your life. We know it can sometimes be stressful. It might also be a rather confusing process-especially if you're a new home buyer. You may not know what is up or down when it comes to mortgages, but that's okay. A mortgage professional will take the time and consideration to carefully lead you through the mortgage process until the process is fully complete. Whatever questions you have they will be happy to answer you and guide you.

No matter what, they will always look out for you and offer you the best quality service. Whether you are looking for a mortgage or to refinance your present loan they can be of assistance. If you choose to refinance your loan they will guarantee to help you in the most simple and hassle-free way possible. A mortgage professional will keep you informed in regards to the best refinancing deals so that you can find the right one that is completely perfect for you.

A mortgage professional will get your loans processed and closed quickly so that you can be done with the procedure and move on to other things. They will offer competitive rates when looking to refinance your home so that you know you are truly getting the best available. They will don't settle for anything less than the best when it comes to their customers. The customer service will be outstanding and uniquely catered to your needs. Whatever you are looking for in way of a mortgage you can depend on a mortgage professional to get you the best deals and offer the absolute best service.

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