September 12, 2023 | Driving It Home with ABoR's Housing Economist

This week will prove a particularly significant one for the housing market. On Wednesday, August inflation data (i.e., the CPI) will be released. Headline inflation may measure higher on a YoY basis than the readings for the past several months due to the rise in oil prices. Last week, the 10-year Treasury yield, an important determinant of the direction of mortgage rates, remained elevated amid investors' expectations that the Fed will raise rates later this year. (The market anticipates the Fed will hold rates steady in its September meeting.) The reaction of the 10-year Treasury yield to the inflation reading will play a key role in determining the direction of mortgage rates over the near-term. On a week-over-week basis, housing activity measured lower. Last Monday's Labor Day Holiday caused an uptick in activity in the preceding week as buyers and sellers finalized transactions prior to the holiday. Week-over-week, closed sales were down ~56%; closed leases, ~52%. Sales activity among lower-priced homes (below $350,000) proved particularly strong in August on a YoY basis as the inventory of affordable homes for sale remained constrained. Meanwhile, sales activity among higher-priced homes declined on a YoY basis as would-be buyers demonstrated a preference for other assets amid a high-rate environment. *Links mentioned in this episode:* Market Statistics | https://www.abor.com/marketstatistics Buy Vs. Rent Index | https://www.abor.com/buyrentindex Diversity Summit | https://www.abor.com/event-type/diversitysummit Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2023/09/DIH-9-12-23.pdf *NEW* Read the Truth About Austin's Missing Housing Report: https://www.abor.com/thetruth Download the Buy Vs. Rent Index: https://www.abor.com/buyrentindex Access the One-Page Customizable Buy Vs. Rent Index Summary: https://www.abor.com/customizables Connect with us on socials: https://www.abor.com/socials Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey