Morning Report: 25% of homebuyers are leaving due to the Coronavirus

Vital Statistics:

Stocks are higher this morning on no real news. Bonds and MBS are flat.

The Northeast is still dealing with the aftermath of Isiasis. Power is out all over the place.

The White House and House Democrats are getting closer on a second COVID stimulus bill.

Mortgage Applications fell 5.1% last week as purchases fell 2% and refis fell 7. “Mortgage rates dropped to another record low last week, falling below the previous record set three weeks ago to 3.14 percent,” said MBA Associate Vice President of Economic and Industry Forecasting Joel Kan. “Refinance activity decreased–despite the decline in rates–but the current pace remains more than 80 percent higher than a year ago when rates were over 4 percent.”

25% of homebuyers are moving because of the pandemic. “Somewhat counterintuitively, the coronavirus-driven recession is propping up the housing market,” said Redfin chief economist Daryl Fairweather. “Homebuyer demand is surging despite GDP taking a historic nosedive in the second quarter, largely because Americans value the home more than ever and are willing to prioritize housing even as they cut back on other expenses. Additionally, the Fed is using low interest rates to stimulate the economy, which is giving buyers more purchasing power and boosting home sales. But even with low rates, widespread unemployment and financial uncertainty mean not everyone who wants to buy a home is able to.”

Payrolls only increased by 167,000 last month according to ADP. That said, June was revised upward.

Author: Brent Nyitray

In the physical sciences, knowledge is cumulative. In the financial markets, it is cyclical View all posts by Brent Nyitray