National Real Estate Transaction Changes

  Some of you may have heard of changes in USA law on how Real Estate transactions are to be negotiated from this moment on. We have prepared a video that can provide some insight as to what these changes are and how Penner Group Properties has been ahead of the game in preparing for these changes!If you would like more information on this or any other Real Estate subject on a 1-1 basis with us, please give us a call at (971) 777-3137 or email us here!  

Portland Real Producers Feature - June 2023

A Look into the Markets - January 24, 2025

This past week Interest rates held steady in what was a short week with few economic reports. Let’s discuss what happened and discuss what to watch for in the weeks ahead. "Turn and face the strange. Ch-ch-changes"- Changes by David Bowie.   The big news of the week was the inauguration of our 47th president, Donald J. Trump. A new President brings new fiscal policies. The financial markets will now be observing how these fiscal policy changes will affect the economy. Fiscal policy is how a government uses spending and taxes to manage the economy. Goals of Fiscal Policy: Promote economic growth: By spending more money (e.g., on roads, schools, or healthcare), the government can create jobs and boost business activity. Control inflation: By reducing spending or increasing taxes, the government can slow down an overheated economy. Reduce unemployment: Spending on programs or infrastructure can help create more jobs. Types of Fiscal Policy: Expansionary Fiscal Policy: Used when the economy is weak (e.g., during a recession). The government spends more or cuts taxes to encourage people and businesses to spend. Contractionary Fiscal Policy: Used when the economy is growing too fast and inflation is high. The government spends less or raises taxes to slow down demand. In short, fiscal policy is the government's way of using money to keep the economy healthy. Too Much Spending  The challenge? Parts of our economy are struggling, such as mortgage, housing, and manufacturing. These areas might benefit from expansionary fiscal policy. However, the challenge we have is dealing with inflation remaining high and well above the Fed’s target. Additionally, increased deficit spending would mean we would have to sell even more debt (bonds), which the bond market does not like. Signs of Disinflation Disinflation is simply a slower rate of inflation. Back in 2022, we experienced inflation near 9%. Disinflation has lowered inflation to an annual rate of just above 3.00%. There are signs that disinflation will continue. First, rental vacancies have continued to climb. Should this continue, it will help lower overall inflation, where shelter plays a big role. Looking ahead, lower energy costs would also play a big role in pushing disinflationary forces. 30-yr Mortgage Rates The 30-year fixed rate averaged 6.96% as of January 23, 2025, down from the previous week when it averaged 7.04%. A year ago at this time it was 6.69%.  10-year Note yield 4.50% The 10-year Note yield, which ebbs and flows with mortgage rates, declined nicely from the 2024 highs above 4.80%, backing down to the 4.55% level.  Bottom line: The previous two times rates were at these levels, they improved nicely. The recent softer inflation numbers may have been the spark to help rates improve this time around and now it may be more about changes to fiscal policy which could have a big impact on whether inflation “disinflates” further or remains elevated.  Looking Ahead Next week is a big week with the Fed Meeting, but this meeting may be a bit muted. Why? There is currently no chance of a rate cut and with fiscal policy still uncertain, the Fed and markets are more in a wait and see mode.  There are also some big reports which could move the markets, including the Fed’s favored gauge of inflation, the Core Personal Expenditure Index (PCE). Gross Domestic Product (GDP) for the 4th Quarter of 2024 will also be released. While backward looking, it gives us a sense of where the economy is headed into 2025. Mortgage Market Guide Candlestick Chart Mortgage bond prices determine home loan rates. The chart below is a one-year view of the Fannie Mae 30-year 6.0% coupon, where currently closed loans are being packaged.  As prices move higher, rates decline, and vice versa. If you look at the right side of the chart, you can see the recent rebound higher in prices (lower in rate) is being challenged by a ceiling of resistance which will act to halt any further rate/price improvement. Chart: Fannie Mae 30-Year 5.5% Coupon (Friday, January 24, 2025) Economic Calendar for the Week of January 27 - 31 Mark Snow Senior Loan Officer | NMLS #259960 397 SW Upper Terrace Dr. Suite 150, Bend OR 97702 O: (503) 929-5887 | M: msnow@guildmortgage.net Visit My Webpage