Core Insights - The optimal time to buy a home is during the week of Oct. 12-18, characterized by higher inventory, lower prices, and reduced competition [1][2] - October typically sees price reductions averaging 5.5% and an increase of 15.7% in listings, providing buyers with more choices [2] - Buyers can expect 30.6% less competition and potential savings of $15,000 during this period [2] Market Trends - Homeowners are experiencing a "lock-in effect," with over 80% locked in at rates below 6%, making it difficult for them to sell [5] - Current mortgage rates are between 6.5% and 7%, with expectations that they will not drop below 6% until late 2025 or 2026 [5] - Selling in a future market with lower rates could yield an additional 5%-10% on the final sale price due to increased buyer demand [7] Buyer Behavior - Many homeowners are opting to stay in their current homes due to the financial implications of moving to higher mortgage rates [4] - Increased buyer demand when rates decrease could lead to bidding wars, providing sellers with more options and leverage in the selling process [7] Recommendations - For potential homebuyers, the week of Oct. 12-18 is highlighted as a prime opportunity to purchase a home [1][2] - Homeowners considering selling may benefit from waiting until 2026 when interest rates are expected to decline [3][4]

And we start off with the latest headache for the housing sector. The XHB homebuilder ETF dropping another 2% today, hitting its lowest level in over two months. The ITB construction ETF on pace for its worst week of the year.And some of the biggest names in the space, down 10% or more since Monday. And while mortgage rates are down from their highs of the year, they remain stubbornly stuck above 6%. So, is there anything other than a major move lower in rates that could get builders climbing again.Guy, wha ...

Core Viewpoint - The housing sector is facing significant challenges, with major homebuilder ETFs experiencing declines and mortgage rates remaining above 6%, impacting builder performance and stock prices [1][4][10]. Group 1: Market Performance - The XHB homebuilder ETF has dropped 2%, reaching its lowest level in over two months, while the ITB construction ETF is on track for its worst week of the year [1]. - Major homebuilders like DHI, PY Homes, and Toll Brothers have seen stock declines of 10% or more since Monday, indicating a broader market downturn [2]. - The ITB is down 20% from its all-time highs, suggesting underlying issues in the housing market [12]. Group 2: Mortgage Rates and Builder Strategies - Although mortgage rates have decreased from their highs, they remain above 6%, which is a significant barrier for builders [1][11]. - Builders are reportedly buying down an average of 100 basis points in mortgage rates, effectively lowering rates to below 5.5%, but this strategy is margin destructive [4][10]. - The structural profitability problem in the housing industry is exacerbated by increased input costs and labor issues, making lower rates insufficient to improve profitability [10][11]. Group 3: Inventory and Pricing Pressure - There is an observed increase in inventory across various regions, which is expected to put pressure on pricing and subsequently affect stock performance [3][4]. - New home prices are reportedly cheaper than existing homes for the first time, indicating a shift in market dynamics [9]. Group 4: Broader Economic Implications - The current challenges in the housing market may be indicative of broader economic issues, including potential tariff implications on earnings and supply-side dynamics affecting corporate margins [8][10]. - The home improvement sector may see activity pick up if mortgage rates decline, presenting a potential area of interest for investors [10][12].

Mortgage rates in the US resumed their downward path, falling for the first time in three weeks https://t.co/7GRcTUDMW9 ...

Heard on the Street: A small drop in mortgage rates in recent weeks triggered an outsize response from borrowers https://t.co/xYGgtihuUj ...

Core Viewpoint - Peter Schiff warns of a potential housing crisis due to rising mortgage rates and inflated home prices, suggesting that many homeowners may default on their mortgages and "mail in their keys" [2][3]. Group 1: Housing Market Dynamics - Schiff attributes the high housing prices to historically low mortgage rates, which allowed buyers to afford higher prices [2]. - The current situation shows a mismatch where mortgage rates have increased significantly, but home prices have not adjusted downward accordingly [2][3]. - This disconnect is expected to lead to a housing emergency, with defaults increasing as homeowners struggle to sell their properties for more than they owe [3]. Group 2: Homeowner Behavior - Many homeowners are currently reluctant to sell due to locked-in low mortgage rates, which has reduced selling pressure in the market [3]. - However, eventual life changes such as job relocations or financial strain will force some homeowners to sell, potentially at a loss [3]. - Schiff predicts that this could trigger a "cascading effect" throughout the housing market as more homeowners opt to default [3].

President calling out the homebuilders in a new truth social post saying the FHFA can help. But Kennet, our Diana Ol has that story today. Hey Diana. Hey Carl.Yeah. President Trump posted that the homebuilders have to start building homes. They're sitting on 2 million empty lots.A record. He said, "I'm asking Fanny May and Freddy Mack to get big home builders going and by doing so help restore the American dream." Now, FHFA director Bill Py, who oversees Fanny and Freddy, posted that he would do just that. ...

Recent surveys of lenders and real estate agents indicated that mortgage rates would need to fall to 5.75% to unlock the housing market from its current frozen conditions. https://t.co/ph3Mm3f0Ho ...

Market Performance & Trends - S&P 500 up by 006%, marking the fifth straight win [2] - NASDAQ Composite also experienced a win [2] - Dow recorded a record win [2] - Small caps up by one third of a percent [2] - Material sector led with over 1% gain, followed by tech and industrials [3] - Energy sector declined by over 1%, with consumer discretionary also showing losses, primarily due to Tesla [3][4] - Mega caps showed mixed performance, with Microsoft down about 075% and Meta up over 1% [4] - Semiconductors experienced significant gains, with Intel up almost 4%, AMD and Global Foundry each up 35% [5] - Speculative investments like crypto (GBTC up about 3%), solar (TAN), Arc Invest, and IPOs saw money inflow [6] AI & Investment Strategy - AI is reshaping industries, potentially leading to significant unemployment followed by new job creation [8][9][10] - Diversification is crucial, but many companies are heavily investing in AI, comfortable with the perceived risks [12][13] - Investors are showing interest in diversification, including fixed income and alternative investments like gold [17] - There's a growing openness to alternative investments, potentially reaching 20% of portfolio allocation [20] Mortgage & Housing Market - Mortgage rates experienced a slight rise for two straight weeks but remain relatively low for the year [22][23] - Refinance application volume initially jumped with lower rates but decreased as rates drifted up [25][26] - Pent-up demand exists, especially among first-time home buyers (50 million people between 30 and 40) [27][28] - ARM (Adjustable Rate Mortgage) share is increasing, with typical ARMs offering initial fixed rates for 5-10 years at 75 to 100 basis points lower than 30-year fixed rates [37][39][40] Government Shutdown Impact - Essential services continue, but workers may not receive paychecks [43] - Non-essential services like national parks and Smithsonian museums will close [44] - Federal Medicare and Medicaid benefits will not be impacted; Social Security distribution will continue, but staffing may be affected [45] - SNAP benefits will be affected if the shutdown lasts over 30 days [46] - The monthly jobs report will be delayed, creating uncertainty for the Fed's policy decisions [47][48][49]

Housing Market Slowdown & Incentives - Home builders are offering incentives like lower interest rates to attract buyers in a slow market [1][5] - 65% of home builders offered incentives last month [2] - The housing market is experiencing a slowdown in both home sales and construction pace [2] - High mortgage rates near 7% at the beginning of the year contributed to the slowdown [2] Affordability & Buyer's Market - The housing market is affordability-constrained due to a 40-45% increase in home prices during the pandemic [3] - Summer marked the strongest buyer's market since 2013 [4] - Low levels of existing home sales are observed due to strained affordability [4] - The number of unsold new finished houses is at the highest level since 2009 [4] Regional Variations & Builder Strategies - Increased housing inventory is seen in regions that experienced booms during the pandemic, such as Texas and Florida [5] - Builders are offering incentives to move inventory in these regions [5] - Builders may spend $30,000-$50,000 or more on incentives like buy-down deals, potentially saving home buyers 10% or more [6]