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This Week In Real Estate – November 7, 2021

Central Oregon Real Estate - This Week In Real Estate

Mortgage Rates Fall, But Are Expected To Rise Again.

The Federal Reserve announced, this week in real estate, that beginning this month they will taper the purchasing of its “pandemic era” bond purchases. The Federal Reserve has supported the housing market during the COVID-19 pandemic and subsequent, ongoing recovery via asset-backed purchases, including $40 billion a month of mortgage-backed security purchases. These purchases have held interest rates lower than they otherwise would have been. These actions will put some upward pressure on interest rates. Below are a few newsworthy events from the first week of November that influence our business:

New HBI Report Shows Labor Shortage Weakening Housing Supply, Affordability.

A lack of skilled construction labor is a key limiting factor for improving housing inventory and affordability, according to the Home Builders Institute’s (HBI’s) Fall 2021 Construction Labor Market Report released today. The report cautions that the required number of construction workers to keep up with demand is approximately 740,000 new workers per year for the next three years, based on a new analysis of Bureau of Labor Statistics data by NAHB. “The construction industry needs more than 61,000 new hires every month if we are to keep up with both industry growth and the loss of workers either through retirement or simply leaving the sector for good,” said HBI president and CEO Ed Brady. “From 2022 through 2024, this total represents a need for an additional 2.2 million new hires for construction.” Full Story…

Mortgage Rates Fall For The First Time in Weeks.

Mortgage rates declined for the first time since a month ago, but the retreat isn’t guaranteed to last long. The 30-year fixed-rate mortgage averaged 3.09% for the week ending Nov. 4, down five basis points from the previous week, Freddie Mac reported Thursday. The Fed announced Wednesday that it will begin scaling back the monthly bond purchases it has engaged in since the start of the pandemic in an effort to prop up the economy. At the start of the COVID-19 crisis, the central bank was buying trillions of dollars in bonds but then reduced that amount to a pace of $120 billion per month in June. Now, the Fed said it will further decrease that pace by $15 billion per month in November and December. The move is seen as “a vote of confidence in the current state and expected future of the economy,” Danielle Hale, chief economist at However, this does mean that the Fed will be purchasing $5 billion less in mortgage-backed securities per month starting in November. Those purchases gave mortgage lenders the fuel needed to keep interest rates as low as they have since last year. Full Story…

Profit Margins on U.S. Home Sales Spike to Decade High in Q3.

According to ATTOM Data‘s newest quarterly U.S. Home Sales Report, profit margins on median-priced single-family home and condo sales across the United States jumped to 47.6 percent – the highest level since the end of the Great Recession, a decade ago. In yet another sign of how strong the U.S. housing market remains, the report reveals that the typical home sale across the country during the third quarter of 2021 generated a profit of $100,178 as the national median home price hit a record of $310,500. The latest profit level – also a new high – was up from $88,800 in the second quarter of 2021 and from $69,000 in the third quarter of 2020. Those gains raised the typical return on investment that sellers made on their original purchase price nationwide from 42 percent in the second quarter of this year and 34.5 percent a year earlier. The investment-return increases marked the biggest quarterly jump since 2014 and the biggest annual surge since at least 2008. Soaring profits in the third quarter came as the national median home price increased 3.5 percent from the second quarter of 2021 and 15.9 percent from the third quarter of 2020. The annual price surge marked the fifth straight quarter with year-over-year increases of at least 10 percent. “The third quarter of this year marked another period in a banner year for a housing market boom that’s steaming ahead through its 10th year. Prices and seller profits again hit new highs since the market started coming back from the Great Recession in 2012,” said Todd Teta, chief product officer at ATTOM. Full Story…

Originally compiled & posted by Jason Waugh on the Berkshire Hathaway HomeServices Northwest Real Estate company blog.

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Mitch Darby

I am a real estate broker, architect (both licensed in the State of Oregon), and life-long Oregonian. If you are looking to buy or sell, I can help! I have Northwest Knowledge and am proud to be associated with Berkshire Hathaway HomeServices - Real Estate's Forever Brand!

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