Interest rates fell this week on account of the recent volatility of the ten-year treasury yield. It’s possible they may keep falling as fears of the spreading Coronavirus make the markets more volatile due to the economic slowdown in China. There’s a lot of pressure on the federal reserve to lower interest rates and the vice chairman of the fed, Richard Clarida, said the Central Bank is monitoring the situation closely but it’s too soon to know exactly what should be done.
Mortgage applications increased 1.5% from one week earlier. Next week’s numbers will show just how much the drop in the U.S. Treasury yields will affect mortgage activity.
Pending Home Sales Report
Yesterday the National Association of Realtors released the Pending Home Sales report for January and reported a climb of 5.2%. This is the second-highest monthly figure in over two years.
It’s interesting to note the west saw a small drop in month-over-month contract activity, the other three major regions saw pending home sales grow. All four regions are up year-over-year. The south saw the highest pending home sales growth of 8.7% in January.
The Housing Supply Shortage
The housing supply shortage is something we’ve been hearing about for a while. This week, Freddie Mac released a report on the shortage and provided some startling numbers. Estimates show that we are undersupplied by 3.3 million units and the shortage is rising at 300,000 units per year.
Local Market News
Every month I like to take a look at the hottest areas on the MLS and see what areas of DFW have the tightest supply and lowest months of inventory. This month you’ll hear some familiar areas that seem to always make the list.
Coming in at under 1 month of inventory and the hottest areas on the MLS we have:
We will have to see what happens to rates as the spread of the coronavirus keeps making the headlines in the news. If this continues and the world economies keep on their downward trend, it’s likely rates will see another drop.
That’s the update for this week. Thanks for spending the last few minutes with me and I’ll see you next week.
Jennifer Shannon is a Texas real estate agent and broker, licensed since 2006.