The Talas Report: Market Mondays: 11/27/23

1. Stocks are up in home stretch of 2023: Here’s how equities historically perform in the week after Thanksgiving as markets shift to holiday season

This article from MarketWatch ¹ discusses how stocks are performing in the home stretch of 2023. The article highlights that the week after Thanksgiving is typically a good time for equities, with the S&P 500 index posting gains in 12 of the past 15 years. Here are two takeaways from the article:

• Historically, the week after Thanksgiving has been a good time for equities, with the S&P 500 index posting gains in 12 of the past 15 years.
• The article suggests that investors should consider buying stocks that have underperformed the broader market in the year-to-date period.

2. How rate volatility is changing reverse mortgages

According to a recent article on National Mortgage News, the reverse mortgage market is experiencing a lot of volatility due to changes in the economy, housing market, and government policy. This has made it difficult for lenders to price their products and for borrowers to know what they are getting into . The article also mentions that the reverse mortgage market is expected to continue to experience volatility in the coming years. This is due to a number of factors, including changes in the economy, changes in the housing market, and changes in government policy. As a result, it is important for both lenders and borrowers to stay informed about the latest developments in the market.

• Reverse mortgage lenders are facing challenges due to the recent rate volatility.
• The article suggests that reverse mortgage lenders should consider offering more flexible products to help borrowers manage their finances.

3. What will lower mortgage rates do to spring housing inventory?

According to a recent article on HousingWire, the spring housing inventory is expected to increase due to lower mortgage rates. However, the extent of the increase will depend on the direction of the mortgage rates. If the rates continue to fall, the inventory will remain flat or even decrease. If the rates stabilize or increase, the inventory will likely increase. It is important to keep in mind that the current housing market is characterized by exceptionally low inventory, which is restraining sales activity in much of the District

• Lower mortgage rates could lead to an increase in home sales in the spring.
• The article suggests that homebuyers should act fast to take advantage of the current low mortgage rates.

4. Mortgage News Daily. “New Residential Sales”

This article from Mortgage News Daily ⁴ discusses new residential sales. The recent Census Bureau’s New Home Sales report reveals a decline from 719k to 679k in October, though still comparable to pre-COVID highs. The housing market post-COVID has seen diminishing inventory, leading to increased market share for new homes. Existing home sales have notably dropped since mid-2022, coinciding with rising interest rates. The report underscores a 40% decrease in sales alongside rising home values, attributed to an inventory shortage and low interest rates. The current outlook for the housing market, with sales in the 650-750k range, is considered fairly neutral, with future trends hinging on potential changes in interest rates.

• Market Dynamics Shift: New Home Sales decline signals a change in market dynamics, with reduced inventory favoring new homes over existing ones, especially as interest rates rise.
• Inventory and Rates Impact: A 40% drop in sales accompanies rising home values, attributed to inventory shortages and low interest rates. Future housing trends hinge on potential shifts in interest rates.

Thank you for reading the first edition of Market Mondays. Stay tuned for more updates on the real estate and market industry.