Incline Village at Lake Tahoe, Nevada Real Estate and Community News

Feb. 21, 2017

LOW INVENTORY

It was another good week for the Incline Village real estate market. 5 properties went into escrow on the Incline Village Multiple Listing Service. That was complemented by 6 new listings, 3 price changes and 5 properties closing escrow. Sales totals early in 2017 are similar to the same time in 2016. But, a lot more condos have sold this year which offsets the decline in closed escrows for houses. It’s too early in the year to make any predictions especially since most of the properties that have closed escrow went under contract late in 2016. On the surface though it looks like we will see at least 350 sales in Incline Village this year.

There is an extreme shortage of condos for sale with only 36 condominiums currently listed on the Incline Village MLS. There are 14 condos in Escrow.

Also with a low inventory are Single Family Homes, with 105 properties on the market. There are 17 homes in escrow

Posted in Market Updates
Feb. 21, 2017

THREE OVERLOOKED TAX BREAKS YOUR HOME MAY BE ABLE TO CASH IN

MINIMIZE WHAT YOU'LL OWE AND MAXIMIZE WHAT YOU'LL GET BACK AT TAX TIME.

People are always making moves (real estate and otherwise) to minimize what they owe and maximize tax returns. But understanding if you’re eligible for tax breaks can be daunting. The tax code is 4 million words and more than 70,000 pages long.

To ensure you’re not missing out on any hefty tax breaks, consider these three common home–related tax breaks that are often missed, overlooked, and underused.

While it’s easy to focus on federal income tax deductions, some state tax rates can reach as high as 15 percent of your annual income!

In the past year, homeowners have taken steps to improve their home’s energy efficiency for a variety of reasons, including cash savings on utility bills.

The good news: Many of those improvements are eligible for state, county, and/or city tax credits — or tax breaks. If you’ve installed dual-paned windows, insulation, low-flow plumbing appliances, tankless water heaters, or solar panels last year, dig up your receipts.

Then talk with your tax preparer or visit your state, county, and city government websites to research tax advantages for which you might already be eligible.

Many homebuyers expressly call out the mortgage interest tax deduction as a major motivation behind their desire to own a home. The ability to write off interest on up to $1 million of mortgage debt shifts the affordability equation and makes buying more financially compelling than renting for thousands of homeowners every year.

According to the American Institute for Economics Research, only about 63% of homeowners itemize deductions — a prerequisite to taking the mortgage interest deduction and its cousin, the property tax deduction.

This isn’t always because owners are unaware of potential savings. There’s a number of people whose income tax liability is simply so low that itemizing their tax deductions doesn’t add up. Low tax liability means that some people’s holistic financial picture, including earned income and deducted mortgage interest, renders a larger standard deduction than the tax break they would receive by virtue of the mortgage interest and other itemized deductions.

However, many homeowners who are eligible for itemizing don’t fully appreciate what they stand to gain or simply don’t feel up to the task of determining whether they have sufficient non-mortgage-related deductions to itemize, so they do their own taxes and take the standard interest deduction to minimize the work.

If you have a high mortgage or property tax bill, it might be obvious that itemizing makes sense. But if not, you owe it to yourself — and your bank account — to at least try working with a tax preparer or committing to spend the time and energy it takes to explore the question of whether itemizing makes sense.

Even an extra thousand dollars or two in tax savings can make a huge difference to your savings and your financial future.

Normally, defaulted mortgage debt that is forgiven through a foreclosure, short sale, deed in lieu of foreclosure, or settlement via partial payment is actually charged to a taxpayer as income. It’s called cancellation of debt, or COD.

Under the 2007 Mortgage Debt Forgiveness Relief Act, though, the IRS has temporarily exempted COD from incurring income tax liability for as many as 100,000 homeowners a year, to avoid penalizing homeowners for these sorts of settlements and resolutions to upside-down home mortgages.

The Act was initially set to expire in 2013, but was extended through 2016.

If you were able to close a short sale or settle a defaulted home loan in 2016, chances are good that you are eligible to take advantage of the COD tax break when you file your 2016 return.

State and local tax breaks for green home improvements

Mortgage interest tax break

COD tax exemptions

- See more at: https://www.trulia.com/blog/3-often-overlooked-real-estate-tax-breaks/?ecampaign=con_cnews_digest&eurl=www.trulia.com%2Fblog%2F3-often-overlooked-real-estate-tax-breaks%2F#sthash.3LTk4MYz.dpuf

Posted in Community News
Feb. 17, 2017

REAL ESTATE AND MORTGAGE RATES - LAST WEEK IN REVIEW AND FORECAST FOR THIS WEEK

Housing numbers, Retail Sales and inflation data told quite the tale, while words from the Fed chair also caught people's attention.

In housing news, Housing Starts slipped in January but still beat expectations. The Commerce Department reported Housing Starts declined 2.6 percent in January from December to an annual rate of 1.246 million. However, Housing Starts were up 10.5 percent from January 2016. In addition, Building Permits were 4.5 percent above December's figures. New housing inventory that is in the works or being planned will be a welcome sign to homebuyers.

Retailers enjoyed a solid January as consumers seemed more upbeat about the economy. Retail Sales rose 0.4 percent, above the 0.2 percent expected, while the December reading was revised higher, per the Commerce Department. From January 2016 to January 2017, Retail Sales were up 5.6 percent.

Inflation on both the consumer and wholesale sides was also hotter than expected in January, with the wholesale-measuring Producer Price Index (PPI) reaching its highest reading since the fall of 2012. Of note on the consumer side, year-over-year Consumer Price Index rose to 2.5 percent. Year-over-year PPI remained unchanged at 1.6 percent.

Rising inflation decreases the value of Bonds, like Mortgage Backed Securities. This, in turn, can have a negative impact on home loan rates, which are tied to Mortgage Bonds. While Mortgage Bonds reacted negatively to the hot inflation and robust economic data, it was the words of Federal Reserve Chair Janet Yellen that really set markets in motion. Yellen caused a stir early in the week when she said it would be "unwise to wait too long to hike interest rates," referring to the Fed Funds Rate. This is the rate at which banks lend money to each other overnight. Her remarks revved a record-setting Stock rally at the expense of Bonds, though Mortgage Bonds rebounded later in the week.

Despite the volatility, home loan rates remain in historically low territory.

If you or someone you know has any questions, please don't hesitate to contact me.

Forecast for the Week

Housing news will be the bookends of a short week. Markets are closed Monday in observance of Presidents Day.

In housing news, Existing Home Sales will be released on Wednesday followed by New Home Sales on Friday.

Thursday brings the usual weekly Initial Jobless Claims.

The Consumer Sentiment Index will be shared on Friday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds have rebounded in recent days. Despite recent volatility, home loan rates are still in attractive territory.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Feb 17, 2017)

Posted in Real Estate News
Feb. 13, 2017

REAL ESTATE AND MORTGAGE RATES - LAST WEEK IN REVIEW AND FORECAST FOR THIS WEEK

Mortgage Bonds were knocked down in the latter part of January, rallied as February picked up steam, and then dropped again.

Mortgage Backed Securities, the type of Bond to which home loan rates are tied, worsened after a five-day rally. These Bonds have not been able to break above the resistance level set in November 2016.

Mixed earnings reports in the U.S. coupled with a floundering Greek economy that grabbed headlines again both contributed to the recent rally in Mortgage Bonds. Close to a decade since its first bailout, Greece is in worse shape than it was in the financial crisis. Other countries like Italy, Portugal and Spain are also struggling with debt and tepid economic growth.

As global economic uncertainty continues, we may see the return of investment dollars to the safer haven of the Bond market. Home loan rates, in turn, may benefit as home loan rates are tied to Mortgage Bonds.

Improved Bond prices and home loan rates would be a welcome sign as housing prices continue to rise. Home price gains continued through the end of 2016, surging in December. CoreLogic, a leading provider of consumer, financial and property information, reported that home prices, including distressed sales, rose 7.2 percent from December 2015 to December 2016. From November to December, prices rose 0.8 percent. The U.S. has experienced 59 consecutive months of year-over-year increases. CoreLogic forecasts a 4.7 percent increase in prices from December 2016 to December 2017.

Despite the market volatility, home loan rates remain in attractive territory.

If you or someone you know has any questions, please don't hesitate to contact me.

Forecast for the Week

Inflation and housing news will stand out in a packed economic calendar.

Look for wholesale inflation data via the Producer Price Index on Tuesday. The Consumer Price Index follows on Wednesday.

Manufacturing data from the Empire State Index will be delivered on Wednesday, with the Philadelphia Fed Index on Thursday.

Retail Sales will be released Wednesday.

Housing news is abundant with the NAHB Housing Market Index on Wednesday, and Housing Starts and Building Permits on Thursday.

As usual, weekly Initial Jobless Claims will be reported on Thursday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds rallied for several days before getting knocked down again. Home loan rates are still in attractive territory.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Feb 10, 2017)

Posted in Real Estate News
Feb. 7, 2017

REAL ESTATE AND MORTGAGE RATES - LAST WEEK IN REVIEW AND FORECAST FOR THIS WEEK

Job growth jumped in January, but wage growth weakened.

The Labor Department reported that U.S. employers hired 227,000 workers in January, above the 170,000 expected and signaling the sector kicked off 2017 on a high note. All was not rosy within the report, however. Average hourly earnings rose by a scant 0.1 percent versus the 0.3 percent expected. The December number was revised lower to 0.2 percent from the original 0.4 percent reported. In addition, job growth in November and December was revised lower by a total of 39,000. The Unemployment Rate ticked up to 4.8 percent from 4.7 percent.

Weak wage growth could lead to tepid inflation if the pattern continues, and inflation ended 2016 on a tame note. Core Personal Consumption Expenditures (PCE), which strips out volatile food and energy, increased 0.1 percent versus the 0.2 percent in November. Year-over-year, Core PCE was up 1.7 percent.

And in housing news, the S&P/Case-Shiller 20-city Home Price Index rose by 5.3 percent from November 2015 to November 2016, up from October's annual increase of 5.1 percent.

Maximum employment, price stability and a strong housing sector are key measures considered by the Fed when setting the course of monetary policy. The Federal Open Market Committee (FOMC) kept its benchmark Fed Funds Rate unchanged when it met January 31 and February 1, despite indicating in December that three rate hikes were likely in 2017. At that time, the FOMC raised rates for only the second time in more than a decade.

While a "rate hike" may sound troublesome, purchase or refinance home loan rates are not directly tied to the Fed Funds Rate. The Fed Funds Rate is the short-term rate at which banks lend money to each other overnight. Instead, home loan rates are tied to Mortgage Backed Securities, which are a type of Bond.

For now, home loan rates remain in attractive territory.

If you or someone you know has any questions , please don't hesitate to contact me.

Forecast for the Week

The markets might take a breather in this week of light economic news.

Weekly Initial Jobless Claims will be released Thursday.

Friday brings the Consumer Sentiment Index.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds have stabilized in recent weeks. Home loan rates are still in attractive territory.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Feb 03, 2017)

Posted in Real Estate News
Feb. 1, 2017

THE COST OF WAITING TO BUY A HOME

2017 is going to be a great year for our local housing! If you are on the fence of when to buy, sooner than later is what I recommend. Interest rates are projected to rise steadily for the next 3 years. With home values going up along with interest rates, this creates a lower threshold for buyers to qualify-essentially, decreasing their buying power.

Posted in Buying a Home
Jan. 30, 2017

REAL ESTATE AND MORTGAGE RATES - LAST WEEK IN REVIEW AND FORECAST FOR THIS WEEK

Existing Home Sales and New Home Sales followed a similar path downward in December. But the latest housing reports still had good news to share.

Existing Home Sales closed out 2016 as the best year in a decade, though December's numbers were below expectations at 5.48 million units on an annualized basis. The National Association of REALTORS® reported that sales in 2016 were 5.45 million units, above the 5.25 million in 2015 and the highest since the 6.48 million in 2006.

New Home Sales fell 10.4 percent from November to December. It was the lowest level since February 2015 and down 0.4 percent from December 2015. Although the news was disappointing, data showed a near six-month supply of new homes for sale, which finally signals a healthy balance between supply and demand.

These reports suggest a strengthening job market may have put potential homebuyers and sellers at ease this past year.

Weaker-than-expected economic growth in the final quarter of 2016 came as a surprise. The Bureau of Economic Analysis reported that Gross Domestic Product (GDP) grew by 1.9 percent in the final quarter of 2016, below the 2.2 percent expected and down from the 3.5 percent reported in the third quarter. For all of 2016, GDP grew by a tepid 1.9 percent, down from 2.6 percent in 2015 and at its worst level since 2011. On a positive note, within the report it showed that consumer spending rose 2.5 percent.

The disappointing GDP numbers did give Mortgage Bonds a slight boost, which was a welcome change from the declines experienced throughout January. When Bonds improve, the home loan rates that are tied to them can improve as well. The reverse is also true.

For now, home loan rates remain in attractive territory.

If you or someone you know has any questions , please don't hesitate to contact me.

Forecast for the Week

In a week fully loaded with economic news, employment data and monetary policy will command attention.

Monday kicks off with Personal Income, Personal Spending and the Fed's favorite inflation gauge Personal Consumption Expenditures.

Housing information will come from Pending Home Sales on Monday and the S&P/Case-Shiller Home Price Index on Tuesday.

From the manufacturing sector, Chicago PMI will be delivered on Tuesday followed by the ISM Index on Wednesday.

Labor market news will be plentiful with the ADP National Employment Report on Wednesday, worker Productivity and weekly Initial Jobless Claims on Thursday. The January Jobs Report will be released on Friday, which includes Non-farm Payrolls, Hourly Earnings and the Unemployment Rate.

Also this week, Consumer Confidence will be released on Tuesday, the FOMC Monetary Policy Statement on Wednesday and ISM Services Index on Friday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds have been stutter stepping downward since mid-January. Although home loan rates increased slightly, they are still in attractive territory.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 27, 2017)

Posted in Real Estate News
Jan. 23, 2017

REAL ESTATE AND MORTGAGE RATES - LAST WEEK IN REVIEW AND FORECAST FOR THIS WEEK

While Housing Starts had positive news, inflationary pressures may leave some singing the blues.

December Housing Starts surged 11.3 percent from November, the Commerce Department reported, beating expectations. The numbers suggest that the pullback in November, following the nine-year high in October, could have been an anomaly. While multifamily starts rebounded, single-family starts were modestly lower.

For all of 2016, average monthly Housing Starts of 1.17 million units were the best since 2007 due in part to a strong labor market and rising wages. Building Permits, which signal future construction, fell just short of expectations.

On the consumer inflation front, the December Consumer Price Index (CPI) and Core CPI, which strips out volatile food and energy, were both in line with expectations. Year-over-year CPI is up 2.1 percent from December 2015. The 12-month measure marks the fastest pace of inflationary growth since the period ending June 2014. Rising inflation, at both the consumer and wholesale levels, is worrisome because it reduces the value of fixed investments like Mortgage Bonds and hurts the home loan rates tied to them.

Although Bond prices have dropped in recent days, home loan rates remain at attractive levels.

If you or someone you know has any questions, please don't hesitate to contact me.

Forecast for the Week

The final reading of fourth quarter Gross Domestic Product will close the book on economic growth in 2016.

Existing Home Sales will be released on Tuesday followed by New Home Sales on Thursday.

Also on Thursday, look for the usual weekly Initial Jobless Claims.

On Friday, the final reading for fourth quarter 2016 Gross Domestic Product, Durable Goods Orders and the Consumer Sentiment Index will be delivered.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds have not had a good run recently. Despite this, home loan rates are still in attractive territory.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 20, 2017)

Posted in Real Estate News
Jan. 16, 2017

LAKE TAHOE WEATHER FORECAST

Summary

Foggy, mostly cloudy, and cold today with highs in the 30's. Foggy and partly sunny Tuesday with highs rising into the low 40's at lake level. Wednesday the next storm begins to move in. It will be cloudy and windy with gusts reaching 100 mph on the ridges by late afternoon. Light snow may begin to move in during the afternoon, especially West of the lake along the crest. Wednesday night heavier snowfall will move in and then taper to scattered snow showers Thursday. We could see 5-13 inches at lake level, and 6-16 inches on the mountains by Thursday afternoon. Then a break Thursday night but cold with lows in the 20's. Friday another cold storm moves in with heavy snow into Saturday night. Then tapering to snow showers on Saturday. We could see an additional 6-16 inches at lake level, and 7-22 inches on the mountains by Saturday afternoon. Then a break Saturday night with lows in the 20's. A final cold storm moves in Sunday with heavy snow into Sunday night. Then tapering to snow showers on Monday. We could see an additional 1-2 feet at lake level and 2-3 feet on the mountains. Then a pattern change as high pressure builds in near the West coast. We may see a break in the storms for at least a week starting next Tuesday.

Short Term Forecast

A couple of readers mentioned a 24 hour snowfall record last week. I checked with my official snowfall station the Central Sierra Snow Lab on Donner Summit. They reported that we saw 35 inches of snow in 24 hours during the big storm last Tuesday. The 24 hour record however is 59 inches, so not even close to the 24 hour record.

We have been dealing with fog in the mornings this week. It is pretty thick around the area again this morning. It has been causing ice on the ski lifts which has been an issue for the lower parts of the mountains at the ski resorts. Today will be colder than originally expected with mostly cloudy skies above the fog, and fog down low. The skies may clear a bit more Tuesday allowing the sun to burn off the fog.

The forecast has not changed much from yesterday. The GFS did continue to elongate the trough as it moves in Wednesday. Some runs were even splitting the storm at it hit the Sierra. The latest run this morning is holding it together better, as well as on the other models. It will get very windy on the mountains Wednesday and then we may see light snow move in during the afternoon. Snow levels look to lower faster, possibly to lake level by evening.

Here is the GFS total precip forecast. You can see better spillover East of the crest this morning.

This will be a fast hitting cold front that moves through Wednesday night. The GFS cuts off precip fast Thursday morning. The European model keeps snow showers going a little longer behind the front Thursday. The European model also moves in snow showers a little faster Wednesday afternoon, so it is wetter than the GFS. Expect a quick shot of several inches overnight Wednesday.

Here is the updated snowfall forecast that did tick up slightly with the lower snow levels and better spillover on the GFS. This is by Thursday afternoon as the storm clears the area.

We should have a break Thursday afternoon into Thursday night but then another cold storm may push in snow during the early morning hours Friday. This storm is colder than the first, and looks a little wetter as well. It will also last a little longer with heavy snow Friday into Friday night, before tapering to snow showers by Saturday morning and then moving out by Saturday afternoon.

Here is the GFS total precip forecast through Saturday.

A break Saturday night is short lived as a final cold storm moves in Sunday. This storm could bring heavy snow Sunday into Sunday night before tapering off to snow showers on Monday, and then clearing out Monday night.

Here is the GFS total precip forecast through Monday.

Too early for specific snowfall numbers, but we could see 1-2 feet at lake level and 2-3 feet on the mountains with this storm if the forecast holds.

So basically 6 days of snow starting Wednesday with 3 storms moving through. It appears that each storm will be progressively colder and wetter. That would bring nice powder to the mountains making for incredible skiing on top of the incredible base we have already.

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Extended Forecast Be sure to get out and enjoy the snow over the 6 day period because a pattern change is coming. The latest ensemble runs of the models show that the ridge sit over Western Canada starting next Tuesday and not Alaska yet, with high pressure extending over the Western U.S. That may bring a break in the storms for at least a week starting next Tuesday.

We may see a pattern that finally brings some Winter to the Eastern U.S. with a trough developing there. The AO and NAO are forecast to go negative and the PNA neutral. We could see a trough lock into the East for the end of the month into February and a ridge for the West. Hoping the ridge does shift North and West towards Alaska again so that we can get storms to cut underneath into CA.

Posted in Community News
Jan. 16, 2017

REAL ESTATE AND MORTGAGE RATES - LAST WEEK IN REVIEW AND FORECAST FOR THIS WEEK

Consumers spent more time ringing up sales in December.

The Commerce Department reported that Retail Sales rose 0.6 percent in December from November. The increase was due in part to strong sales for autos. The year ended with momentum that could signal sales growth in 2017. From December 2015, sales were up 4.1 percent year over year. Overall, sales were up 3.3 percent for 2016 after a 2.3 percent gain in 2015.

Meanwhile, wholesale inflation ticked up in December, increasing 0.3 percent from November, as reported in the Producer Price Index (PPI) from the U.S. Bureau of Labor Statistics. From December 2015 to December 2016, PPI climbed 1.6 percent, which was the largest 12-month gain since 2014. Core PPI, which strips out volatile food and energy prices, also increased 0.2 percent from November to December.

Inflation, at both the wholesale and consumer levels, is an important measure to track because increasing inflation reduces the value of fixed investments like Mortgage Bonds. When Bond prices worsen, the home loan rates tied to them can worsen as well.

Although Bond prices and home loan rates took a hit recently following economic news releases, home loan rates are still near historic lows.

If you or someone you know has any questions , please don't hesitate to contact me.

Forecast for the Week

The Consumer Price Index is a key report to watch in a week that kicks off Tuesday with a full slate of manufacturing, housing and other data. Markets are closed Monday, January 16 in recognition of Martin Luther King Jr. Day.

Regional manufacturing data will be released in the Empire State Index on Tuesday followed by the Philadelphia Fed Index on Thursday.

Wednesday brings the closely watched Consumer Price Index along with the Fed's Beige Book.

Look for housing data via the NAHB Housing Market Index on Wednesday and Housing Starts and Building Permits on Thursday.

As usual, weekly Initial Jobless Claims will be reported on Thursday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red "candle" means that MBS worsened during the day, while a green "candle" means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds recently lost some of the footing gained heading into 2017.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Jan 13, 2017)

Posted in Real Estate News