3/24/2022 – MetroIntelligence Economic Update by P. DUFFY
MetroIntelligence Economic Update by P. DUFFY
New home sales decline 2.0 percent in February and 6.2 percent year-on-year
Sales of new single‐family houses in February 2022 were at a seasonally adjusted annual rate of 772,000. This is 2.0 percent below the revised January rate of 788,000 and is 6.2 percent below the February 2021 estimate of 823,000. Year-on-year, the median sales price rose 10.7 percent to $405,700, while the number of unsold units edged up 33.0 percent to 407,000. At current sales rates, these units would sell in 6.1 months vs. 4.4 months in the same month of 2021.
https://www.census.gov/construction/nrs/index.html
Purchase loan apps fall 2 percent from previous week and 12 percent year-on-year as rates rise
The Market Composite Index for mortgage applications decreased 8.1 percent on a seasonally adjusted basis from one week earlier, with purchase loans falling 2 percent (and down 12 percent year-on-year) and refinance activity falling 14 percent (and down 54 percent year-on-year). The average contract interest rate for 30-year fixed-rate mortgages increased to 4.50 percent from 4.27 percent.
Fed Chair Powell hints at steeper rate hikes to come to battle inflation
“The rise in inflation has been much greater and more persistent than forecasters generally expected…In my view, an important part of the explanation is that forecasters widely underestimated the severity and persistence of supply-side frictions, which, when combined with strong demand, especially for durable goods, produced surprisingly high inflation…If we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so.”
https://www.federalreserve.gov/newsevents/speech/powell20220321a.htm