Morning Report: New conforming loan limits are out for 2023

Vital Statistics:

S&P futures3,970-0.25
Oil (WTI)78.46 1.23
10 year government bond yield 3.76%
30 year fixed rate mortgage 6.52%

Stocks are flattish after Chinese stocks rally overnight. Bonds and MBS are down.

Home prices rose 0.1% QOQ and 12.4% YOY, according to the FHFA House Price Index.

This means that the new conforming loan limit for 2023 will be $726,200. It looks like FHFA released the new limits a day early. “House prices were flat for the third quarter but continued to remain above levels from a year ago.” said William Doerner, Ph.D., Supervisory Economist in FHFA’s Division of Research and Statistics. “The rate of U.S. house price growth has substantially decelerated. This deceleration is widespread with about one-third of all states and metropolitan statistical areas registering annual growth below 10 percent.”

The growth in the West is slowing, while the Southeast (especially Florida) is accelerating.

Separately, the Case Shiller Home price Index showed prices declined overall about 1.5% in September.

Redfin noted that home price growth is cooling the fastest in the Pandemic Boomtowns of Austin, Phoenix and Boise. “The forces slowing the housing market, such as high mortgage rates, are having an outsized impact on places like Austin and Boise that saw home prices skyrocket over the last few years,” said Redfin Senior Economist Sheharyar Bokhari. “Home prices can only rise by double digits for so long before the growth becomes unsustainable. High rates and stumbling tech stocks are making it unsustainable quite quickly, especially in destinations popular with tech workers. Plus, many of the out-of-towners with big budgets who wanted to move into those places already have.”


Author: Brent Nyitray

In the physical sciences, knowledge is cumulative. In the financial markets, it is cyclical

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