If any of you are looking to buy a home you have plenty of time to wait. Fannie Mae sees dark days ahead for the housing market
Didn't you propose even larger increases in interest rates? Are you celebrating this news as the interest rate hikes working as intended?
I am not celebrating this news at all. Housing prices were already in a bubble and inflation is the highest in 41 years at 9.1%. So yes, to fight inflation you have to raise the Fed Funds rate to 5.75% and you have to bring down the price of oil by drilling everything you can. The bubble in car prices is popping too.
Inflation is not currently at 9.1%. And you realize that you posted an article about how higher mortgage rates are causing a decline in new housing sales, which is lowering inflation? So, the policy is doing what it is supposed to do, right?
For the month of July? That is what the data shows. Prices did not, based on the weighted average of the CPI basket, increase from June 2022 to July 2022. On a year-over-year basis, it was 8.5%. It was not 9.1%.
That's the June number, July was 8.5%. The inflation rate target by the Fed is 2%. So inflation for July is well over 200% of the federal reserve's inflation target.
Inflation is not calculated month to month by any measure, inflation is counted year over year. It's been calculated that way forever. 0% LMAO!!!!
These are July numbers it's the newest data available. August inflation numbers aren't out yet...LMAO!!!!
It is actually calculated as both, which is why both are in the CPI tables, which have not changed. Consumer Price Index Summary - 2022 M07 Results
Inflation is calculated both MOM and YOY. Just looking at one number can potentially give you skewed perception. The YOY baseline for July inflation was 8.5%, meaning, 0% MOM inflation, and the YOY number would still be 8.5%. It's possible that there could have been MOM deflation in July, and we would still likely have over 8% YOY inflation. But just looking YOY wouldn't give you a clear story. There will be high YOY inflation until October. That's when the current inflationary pressures started to take off. But if the MOM numbers continue to show little or no inflation, then come Q4, we'll start seeing YOY inflation numbers at 2% or lower.
LOL ... we are back to expressing percent increases as percent increases? ... and not even doing the math right....
CNBC has an article today saying this may be the housing bottom, as home sales only fell 1% this month after several months of stepper declines due to interest rate hikes ... if this the bottom, I'm fine with that. My business is closely tied to the real estate market and I've hardly seen a slow down, really. I know zillow isn't perfect but it only shows a 1.5% decline in my homes' values since the peak... works for me. https://www.cnbc.com/2022/08/24/pending-home-sales-drop-1percent-in-july.html
This is up with the dumbest things said on Too Hot ... of course people watch the month to month changes because that the read out that tells you when the top/bottom is in for investment purposes. The year-year number is a lagging indicator.
Depends on your definition of “plenty of time”. If I were in the hunt I would wait about a year, but not much longer. The underlying fundamentals are and will be supportive of prices for at least the next decade. It’s worth noting this economy and housing market have almost zero parallels to 2008 or any other serious period of correction. No similarities in underwriting, none from owners’ equity positions, and none from a supply perspective. Sure rates are a couple points higher, but still very low from a historical perspective. I can see some markets having a 10-20% correction but expect national prices to be down just slightly over the next year, provided rates don’t dramatically increase.
And the rate for the month of July was 0. The 8.5% is for the preceding 12 months. Consumer Price Index unchanged over the month, up 8.5 percent over the year, in July 2022 : The Economics Daily: U.S. Bureau of Labor Statistics
