Blog posted On December 28, 2018
Mortgage rates did not move significantly this week, trending slightly downward. Markets were closed on Tuesday in observance of the Christmas holiday. The US government has been partially shutdown since Thursday 12/20, following a budgetary dispute in Congress. The S&P CoreLogic Case-Shiller home price index was released on Tuesday, as planned. New home sales were delayed due to the partial government shutdown.
The Case-Shiller home price index was released, as scheduled, on Tuesday. The seasonally adjusted 20-city index increased 0.4% month-over-month. Year-over-year, the index is up 5.0%. The data indicates that home price appreciation continues to slow, although home prices are still rising at a faster pace than incomes. Only Las Vegas saw double-digit annual gains. Month-over-month, 8 metros actually saw a decrease in home prices and 2 were unchanged.
The new home sales report, scheduled for release on Thursday, was delayed due to the government shutdown. The report will likely be released once the government reopens.
The pending home sales index declined unexpectedly in November, down 0.7% month-over-month to a level of 101.4. Although housing starts improved in November, completions of newly constructed single-family homes are down for the third straight month, further constraining already limited for-sale inventory. National Association of Realtors (NAR) chief economist, Lawrence Yun, explained in a statement, “the pending home sales data was not yet reflecting recent favorable mortgage rate conditions.”
The partial government shutdown is likely to continue into the new year. The next budget vote is not scheduled until January 3rd. Additionally, markets will be closed next Tuesday in observance of New Year’s Day.