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This Week In Real Estate – September 3, 2023

Central Oregon Real Estate - This Week In Real Estate

This Week In Real Estate – September 3, 2023.

The Labor Department released its August employment report, this week in real estate, showing job growth picked up, but the unemployment rate jumped to 3.8 percent and wage gains moderated, suggesting the labor market conditions are easing, leading many economists to believe the Federal Reserve will not raise interest rates this month. The report showed 736,000 entered the job market last month, boosting the participation rate (proportion of the population looking for a job or already holding a job) to the highest level in 3-1/2 years. Bonds rallied out of the gate after the jobs report was released. According to Freddie Mac, after accelerating for five consecutive weeks, mortgage rates cooled a bit with the 30-year fixed-rate loan averaging 7.18 percent compared to the prior week’s 22-year high of 7.23 percent. Inventory simply is not meeting demand which in turn is buoying home prices. For the week ending August 26, new listings were down 8.8 percent from the prior year, marking a 60-week decline. The S&P Case-Shiller US National Home Price Index now stands only 0.02 percent below its all-time peak from exactly one year ago. Below are a few newsworthy events from the final week of August that influence our business:

Home Prices Rose For The Fifth Straight Month In June.

Home prices rose again in June, marking the fifth successive month of gains, and remaining near the all-time highs notched a year ago. Prices rose 0.7% from the month before, according to seasonally adjusted data from the S&P CoreLogic Case-Shiller US National Home Price Index released Tuesday. “It now stands only 0.02% below its all-time peak from exactly one year ago,” said Craig Lazzara, managing director at S&P DJI. While home prices have remained strong in 2023, stubbornly high mortgage rates complicate the situation for potential homebuyers, said Selma Hepp, CoreLogic’s chief economist. That will likely keep price gains in check during the rest of the year, she added. Home prices are expected to reaccelerate and reach a mid-single-digit growth rate by the end of the year, she said. The report showed the power of historically low inventory on home prices, which maintained strength despite ongoing affordability challenges, said Hannah Jones, economic data analyst at Full Story…

What The August Jobs Report Means For The Fed.

The long-robust US job market is continuing to cool, according to several economic indicators released this week. The unemployment rate rose to 3.8% in August from 3.5% in July, the Bureau of Labor Statistics reported Friday. Rising unemployment is bad news for Americans, but for the Fed it means some demand has been taken out of the economy, helping ease price pressures. That marks some progress for the Federal Reserve, which is looking for weaker job creation and an overall slowdown in demand in order to defeat inflation. Fed Chair Jerome Powell said last week the central bank needs to see “below-trend growth” for a sustained period to be assured that inflation is on track to 2%, the Fed’s stated inflation target. Powell warned last Friday that evidence of “persistently above-trend growth” could lead to “further tightening of monetary policy,” – or, more simply, additional rate hikes. The Labor Department’s August jobs report should help diminish those fears. The Fed is no longer “chasing inflation,” wrote Steve Wyett, chief investment officer at BOK Financial, in an analyst note. Instead, central bank officials have likely moved into a position where they can “allow the impacts of their actions to date to filter through the economy and markets.” Full Story…

Pending Home Sales Elevated 0.9% In July, Marking The Second Consecutive Monthly Increase.

Pending home sales increased 0.9% in July – rising for the second consecutive month – according to the National Association of Realtors. The Pending Home Sales Index rose 0.9% to 77.6 in July. “The small gain in contract signings shows the potential for further increases in light of the fact that many people have lost out on multiple home buying offers,” said NAR Chief Economist Lawrence Yun. “Jobs are being added and, thereby, enlarging the pool of prospective home buyers. However, rising mortgage rates and limited inventory have temporarily hindered the possibility of buying for many.” 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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