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☆ Home flipping profits drop at the fastest pace in over a decade
▼ + stars: | 2022-12-15 | by ( Diana Olick | In Dianaolick | ) www.cnbc.com time to read: +3 min

It represents the smallest profit since the end of 2019 and the fastest quarterly drop since 2009. With that drop in gross profits, the return on investment fell to 25% from 30% in the previous quarter. With profits shrinking and higher mortgage rates hurting affordability for potential buyers, the share of home sales that were flips fell as well. Mortgage rates have come off their recent highs, but they are still more than twice what they were at the start of this year. Markets that showed the highest flip rates were Phoenix; Spartanburg, South Carolina; Atlanta and Gainesville in Georgia; and Winston-Salem, North Carolina.

☆ On the eve of the Fed’s decision, the case for stocks’ year-end strength is solidifying
▼ + stars: | 2022-12-13 | by ( Michael Santoli | ) www.cnbc.com time to read: +4 min

This is the daily notebook of Mike Santoli, CNBC's senior markets commentator, with ideas about trends, stocks and market statistics. Though after the late-day Monday levitation, with the Fed decision Wednesday and the nearby presence of the S & P 500 resistance line just overhead, the rally has backed off. Inflation declining from high levels has historically been a very positive dynamic for equity performance, and investors remain in a bit of a defensive stance, so the case for year-end strength is solidifying. Of course, there is the Fed decision to get through. The crowd is arguably over-extrapolating near-term recession and earnings-decline hazards in calling for a run toward or below the October S & P 500 lows before a round trip higher.

☆ Mortgage rates drop after CPI report, but the housing market is far from out of the woods
▼ + stars: | 2022-12-13 | by ( Diana Olick | In Dianaolick | ) www.cnbc.com time to read: +2 min

The report sent investors rushing into U.S. Treasury bonds, causing yields to drop. Mortgage rates follow loosely the yield on the 10-year Treasury. But rates then fell sharply in November, after the CPI report for October indicated that inflation was cooling. Some suggested, albeit cautiously, that the drop in rates might be bringing buyers back to the market. Yearly was referring to a very brief rate drop in August.

☆ Analysis: Investors on alert for policy error after cheering slower rate hikes
▼ + stars: | 2022-12-12 | by ( Yoruk Bahceli | ) www.reuters.com time to read: +6 min

With inflation potentially peaking and recession looming, the risk of overtightening accelerating a downturn is on investors' watchlists for next year. "We're past the point of the big (Fed) policy mistake, we think they kind of made it," Robert Waldner, head of macro research at $1.3 trillion asset manager Invesco, said. Recent Fed research suggests the bank has exceeded the level called for by commonly followed policy rules and should target 3.52%, versus the 3.75%-4% it currently targets. Fed research, taking into account the premium on mortgages and corporate borrowing costs, has found financial conditions in September already reflected the equivalent of a 5.25% policy rate. I am worried the Fed may not be taking into account the lags in their monetary policy," Costerg said.

☆ The Federal Reserve is about to hike interest rates one last time this year. Here's how it may affect you
▼ + stars: | 2022-12-12 | by ( Jessica Dickler | ) www.cnbc.com time to read: +2 min

watch nowThe Federal Reserve is expected on Wednesday to raise interest rates for the seventh time this year to combat stubborn inflation. Why a smaller rate hike may be 'pretty good news'What the Fed's rate hike means for youAnother increase in the prime rate will send financing costs even higher for many other forms of consumer debt. On the flip side, higher interest rates also mean savers will earn more money on their deposits. Here's a breakdown of how increases in the benchmark interest rate have impacted everything from mortgages and credit cards to car loans, student debt and savings:1. As the federal funds rate rises, the prime rate does, as well, and these rates follow suit.

See more mortgage rates on Zillow Real Estate on ZillowMortgage calculatorUse our free mortgage calculator to see how today's mortgage rates would impact your monthly payments. 30-year fixed mortgage ratesThe current average 30-year fixed mortgage rate is 6.33%, according to Freddie Mac. 15-year fixed mortgage ratesThe average 15-year fixed mortgage rate is 5.67%, a decrease from the prior week, according to Freddie Mac data. Mortgage rates started ticking up from historic lows in the second half of 2021 and have increased over three percentage points since January 2022. But average 30-year fixed rates will likely remain somewhere in the 5% to 6% range throughout 2023.

☆ Analysis: U.S. financial conditions have eased. So far the Fed is okay with it
▼ + stars: | 2022-12-09 | by ( Ann Saphir | ) www.reuters.com time to read: +5 min

Fresh projections by Fed policymakers released after next week's meeting are expected to reflect that, along with a forecast for no cuts to the policy rate until 2024. Reuters GraphicsThat could feed into arguments that the economy and labor markets are poised to weaken next year, easing inflation pressures. And those drops came despite the Fed lifting its policy rate by three-quarters-of-a-percentage point, to 3.75%-4% in early November. Meanwhile, unemployment has stayed at a low 3.7%, below where Fed policymakers had thought it would be as tighter policy slowed the economy. Reuters GraphicsPart of the reason the Fed may be more comfortable with easing financial conditions now than in the summer is simply that the Fed has already raised interest rates by nearly 4 percentage points.

☆ Germany's housing market is ripe for a serious price correction, economists warn
▼ + stars: | 2022-12-05 | by ( Hannah Ward-Glenton | ) www.cnbc.com time to read: +6 min

"The housing market is softening significantly," he said, citing a strong decrease in demand for loans and a drop in housing construction. watch nowAnd while the language used may vary, many analysts are forecasting a dip in Germany's housing market. A Reuters poll of property market experts last month anticipated German house prices would fall by 3.5% next year. A 'vulnerable' market But not all financial institutions agree that Germany's property market is set for a large correction. The labor market is key Moves in the labor market will determine how the property market shifts, according to some analysts.

☆ A housing market correction will take a long time and prices need to fall as much as 20% in the next few years to return to their historical trend
▼ + stars: | 2022-12-01 | by ( Jennifer Sor | ) www.businessinsider.com time to read: +2 min

The housing market correction will take time, according to DataTrek's Nicholas Colas. Colas pointed to the length of previous housing cycles, where home prices strayed from long-term trends for years. He predicted home prices would need to drop by 15%-20% for the market to return to its long-term growth trend. "US home prices need to fall by about 15-20 percent over the coming years in order to return to their long run growth trend. "Higher mortgage rates will do part of the work in bringing prices back down, of course, but history says any correction in this market will take time," Colas said.

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☆ Nomura CEO says U.S. becomes profit driver despite one-off losses
▼ + stars: | 2022-11-29 | by ( ) www.reuters.com time to read: +1 min

TOKYO, Nov 29 (Reuters) - Nomura Holdings Inc's (8604.T) U.S. wholesale business has emerged as a profit driver despite some large one-off losses in the region that had dragged down the bank's earnings in the past, Chief Executive Officer Kentaro Okuda said. Nomura's wholesale division consists of the global markets and investment banking arms. Japan's biggest brokerage and investment bank has had a long troubled history in its attempts to expand overseas, including the acquisition of assets from the collapsed Lehman Brothers in 2008 which it later wrote down. Okuda said the wholesale business overhaul in 2019, which included cost cuts and scaling back of lower growth segments, has helped turn the business leaner. To help the business become more resilient to market swings, Nomura plans to boost equity, private markets products as well as advisory and wealth management businesses, he said.

☆ Bank of America CEO predicts two years of pain ahead in the housing market
▼ + stars: | 2022-11-29 | by ( Paul R. La Monica | ) edition.cnn.com time to read: +2 min

New York CNN Business —The CEO of one of the nation’s largest banks is preparing for an economic downturn in 2023. But Moynihan told Harlow that the worst-case fears for the economy may not materialize — thanks to the continued resilience of American shoppers. Still, Moynihan is concerned that there could be more tough times ahead for the housing market. And the way you do that is raising interest rates,” Moynihan said. “The intended outcome of [the Fed’s] policies doesn’t feel good when you are trying to buy a home.”Moynihan told Harlow that there could be two years of pain in the housing market before activity returns to normal.

Mortgage rates have decreased from their recent highs, but the average 30-year fixed mortgage rate is still the highest it's been in over a decade. Mortgage rates have increased nearly four full percentage points compared to when they were at their lowest point in January 2021. See more mortgage rates on Zillow Real Estate on ZillowMortgage calculatorUse our free mortgage calculator to see how today's mortgage rates would impact your monthly payments. 30-year fixed mortgage ratesThe current average 30-year fixed mortgage rate is 6.61%, according to Freddie Mac. 15-year fixed mortgage ratesThe average 15-year fixed mortgage rate is 5.98%, a decrease from the prior week, according to Freddie Mac data.

☆ Swedish c.bank raises policy rate to 2.5%, will keep hiking
▼ + stars: | 2022-11-24 | by ( ) www.reuters.com time to read: +2 min

STOCKHOLM, Nov 24 (Reuters) - Sweden's central bank raised its key rate by three-quarters of a percentage point on Thursday to 2.5% and signalled it would tighten policy further next year to fight surging inflation. "The forecast shows that the policy rate will probably be raised further at the beginning of next year and then be just below 3 per cent." Analysts in a Reuters poll had forecast a 75 basis point hike and that the central bank would raise its rate-path forecast. In the United States, the Federal Reserve may soon scale back the pace of its interest rate rises after four consecutive 75 basis point increases. In Europe, some rate-setters at the European Central Bank argue there is a risk of inflation becoming entrenched.

☆ Home purchases by investors plunged 30% in the 3rd quarter as high prices and rising rates drive housing slump
▼ + stars: | 2022-11-22 | by ( Carla Mozée | ) www.businessinsider.com time to read: +4 min

The typical home bought by investors cost $451,975, up 6.4% from a year earlier but down from the second quarter. Meanwhile, investor purchases of high- and mid-priced homes declined more than those of low-priced houses during the July-through-September period. The potential for substantial declines in home prices puts investors at risk of losing money, stoking their pullback in purchases, Redfin said. Investors lost market share for the second consecutive quarter in buying about 17.5% of all homes that were purchased. Those buying rates were higher in the second quarter and a year ago, at 19.5% and 18.2%, respectively, but were still up from 15% before the pandemic.

☆ You need to earn over $200,000 to afford a typical home in these 8 U.S. cities
▼ + stars: | 2022-11-20 | by ( Mike Winters | ) www.cnbc.com time to read: +1 min

Homeownership costs continue to squeeze out all but the richest buyers, and potential homeowners now need to earn $200,000 or more in eight U.S. cities to afford a typical home, a new study found. U.S. mortgage payments are up by an average of 45.6% in the last year. On average, a homebuyer in the U.S. must earn $107,281 to afford a median monthly mortgage payment of $2,682, which is up from $73,668 a year ago, as of October, Redfin finds. But homeownership costs also vary widely by market, with many cities requiring much more income to afford the monthly mortgage payments for a typical home. Out of the largest 100 metro areas in the U.S., these eight markets ranked as the least affordable, based on income needs.

☆ Premarket stocks: Fed officials crushed investors' hopes this week
▼ + stars: | 2022-11-18 | by ( Nicole Goodkind | ) edition.cnn.com time to read: +7 min

But messaging from Fed officials this week has brought Wall Street back down to earth. Tech layoffs don’t mean impending recessionA series of high-profile layoffs have rattled Big Tech this month. The series of high-profile layoff announcements prompted fears that the labor market was weakening and that a recession could be around the corner. Those fears aren’t unwarranted: The Federal Reserve is actively working to slow economic growth and tighten financial conditions to rebalance the white-hot labor market. “The main problem in the labor market is still that labor demand is too strong, not too weak,” they concluded.

☆ Markets are watching for more clues on Fed hikes and the economy in the week ahead
▼ + stars: | 2022-11-18 | by ( Patti Domm | In | ) www.cnbc.com time to read: +7 min

Investors may be a bit more cautious in the week ahead, with stocks seeking direction in quiet trading and the bond market's warnings about recession getting louder. "That's going to cause its own pressure on markets because markets never look through a profit recession." In the past week, Fed officials maintained their tough tone and some even sounded more hawkish. A rallying stock market is a sign of looser financial conditions. "The stock market is complicating the Fed's objective," said Lyngen.

☆ Mortgage rates plunge to 6.61% amid signs of easing inflation
▼ + stars: | 2022-11-17 | by ( Anna Bahney | ) edition.cnn.com time to read: +6 min

Mortgage rates dropped sharply last week following a series of economic reports that indicated inflation may finally be easing. Mortgage rates have risen throughout most of 2022, spurred by the Federal Reserve’s unprecedented campaign of hiking interest rates in order to tame soaring inflation. While the Fed does not set the interest rates borrowers pay on mortgages directly, its actions influence them. Mortgage rates tend to track the yield on 10-year US Treasury bonds. Mortgage rates are expected to remain volatile for the rest of the year.

☆ JPMorgan expects a mild recession for 2023. That means higher unemployment and a rough holiday shopping season for Americans.
▼ + stars: | 2022-11-17 | by ( Phil Rosen | ) www.businessinsider.com time to read: +6 min

The FOMC still has 100 basis points more of rate hikes to go, in the bank's view. To cool down the economy, then, the Fed will likely look to tame hourly wage growth and push the unemployment rate higher, JPMorgan said. "By most measures hourly wage growth is currently running around 5%," the analysts wrote. And that sort of wage growth deceleration will likely require an unemployment rate between 4% and 5%, depending on how entrenched wage growth expectations have become." The Fed's tightening efforts, ultimately, will tip the economy into a recession, JPMorgan analysts said.

☆ Sharp drop in mortgage rates does little to boost demand
▼ + stars: | 2022-11-16 | by ( Diana Olick | In Dianaolick | ) www.cnbc.com time to read: +2 min

Mortgage application volume rose 2.7% last week compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. That, in turn, sent bond yields plunging and mortgage rates with them. Thursday saw the sharpest one-day drop in the average rate on the 30-year fixed mortgage since daily record-keeping began in 2009. On a daily basis, the rate on Thursday alone dropped 60 basis points, according to a separate survey from Mortgage News Daily. Mortgage rates loosely follow the yield on the 10-year Treasury.

☆ Homebuilder sentiment drops to a decade low, as builders add more incentives
▼ + stars: | 2022-11-16 | by ( Diana Olick | In Dianaolick | ) www.cnbc.com time to read: +2 min

Homebuilder sentiment in the single-family housing market fell to the lowest level in a decade in November, as builders continue to struggle with higher costs for labor and materials and lower demand from homebuyers. A monthly sentiment index from the National Association of Home Builders dropped 5 points from October to 33. The NAHB said 59% of builders reported using incentives, a significant increase from September to November. In November, 25% of builders reported paying points for buyers, up from 13% in September. In the South, it fell 7 points to 42 and declined 5 points to 29 in the West.

☆ UK property market at risk of major downturn as recession fears loom
▼ + stars: | 2022-11-15 | by ( Karen Gilchrist | ) www.cnbc.com time to read: +5 min

Matt Cardy | Getty Images News | Getty ImagesLONDON — The U.K. property market may be verging on a major downturn, with some market watchers warning of a collapse in prices of up to 30% as data points to the biggest slump in demand since the Global Financial Crisis. Meantime, the MSCI UK Quarterly Property Index, which tracks retail, office, industrial and residential property, slumped 4.3% in the three months to September, marking the sector's worst performance since 2009. The investment bank now sees U.K. property prices declining by around 10% by the second quarter of 2023. Rising interest rates, soaring inflation and the economic shock from Russia's war in Ukraine have weighed heavy on the global housing market. Indeed, according to Goldman Sachs' analysis, for every one percentage point increase in the U.K. unemployment rate, mortgage delinquency tends to rise by over 20 basis points after one year.

☆ Despite the recent chaos, UK stockpickers are rubbing their hands: Here's what they're buying
▼ + stars: | 2022-11-10 | by ( Elliot Smith | ) www.cnbc.com time to read: +6 min

The U.K. has been beset by political and economic instability in recent months, but as the investment environment undergoes a fundamental transition, investors see opportunity. These attractive valuations for U.K. stocks were also identified in a note last week by BlackRock Fundamental Equities. "Not only has the U.K. discount widened to a level not seen since 2008, but companies are buying back record amounts of their own shares. This compares to the current yield on UK 10-year gilts of around 4%." GAM holds around 50% of its U.K. equity income portfolio in small and midcap stocks, with a focus on companies with strong competitive moats.

☆ Mortgage rates rise back above 7%
▼ + stars: | 2022-11-10 | by ( Anna Bahney | ) edition.cnn.com time to read: +3 min

Mortgage rates have jumped back above 7%, after dropping last week. Mortgage rates have risen throughout most of 2022, spurred by the Federal Reserve’s unprecedented campaign of hiking interest rates in order to tame soaring inflation. Mortgage rates tend to track the yield on 10-year US Treasury bonds. As investors see or anticipate rate hikes, they make moves which send yields higher and mortgage rates rise. Affordability is not improvingWith mortgage rates up four percentage points from a year ago, buyers’ purchasing power has plummeted.

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