On Thursday, February 9, the U.S. Senate Banking Committee will be hosting a hearing titled, “The State of Housing 2023.” at 9:00 a.m. Central at the Dirksen Senate Office Building 538.
As the market continues to shift, the Federal Reserve continues to take action to steady the economic ship, most recently by increasing the fed funds rate by 25 basis points. According to the Bureau of Labor Statistics (BLS), total nonfarm payroll employment rose by 517,000 in January, and the unemployment rate changed little at 3.4%. Job growth was widespread, led by gains in leisure and hospitality, professional and business services, and health care. Employment also increased in government, partially reflecting the return of workers from a strike.
“In the household survey, the unemployment rate continued to trend downward in January, falling to 3.4%, the lowest reading since 1969, and the labor force participation rate ticked up to 62.4%,” noted Doug Duncan, Chief Economist at Fannie Mae. “Average hourly earnings grew by 0.3 percent in January and have grown by 4.4 percent over the last 12 months, a deceleration from prior months but still above pre-pandemic levels, indicating that, while gradually declining, the labor market is still exerting some inflationary pressure. Finally, we note that residential construction employment (including specialty trade contractors) grew by 5,500 in January, though we believe more employment growth will be needed here to help homebuilders fulfill their existing orders.”
Noting that mortgage rates have dropped for four consecutive weeks, Joel Kan, MBA’s VP and Deputy Chief Economist, noted “The spread between mortgage rates and the 10-year Treasury has been abnormally wide since early 2022. Further narrowing of that spread is expected to put downward pressure on mortgage rates in the coming months. Overall application activity declined last week despite lower rates, which is an indication of the still volatile time of the year for housing activity. Purchase activity is expected to pick up as the spring homebuying season gets underway, bolstered by lower rates and moderating home-price growth. Both trends will help some buyers regain purchasing power.”
This week, Freddie Mac reported that the 30-year fixed-rate mortgage (FRM) fell to 6.09% as of February 2, 2023, down from last week when it averaged 6.13%. A year ago at this time, the 30-year FRM averaged 3.55%.
“The State of Housing 2023” will feature a panel of witnesses, including:
- Christopher Herbert, Managing Director, Harvard Joint Center for Housing Studies
- Robert Dietz, Chief Economist and SVP for Economics and Housing Policy, National Association of Home Builders; and
- Lance George, Director of Research and Information, Housing Assistance Council.
Click here for more information or to register for “The State of Housing 2023.”
Here's what else is happening in The Week Ahead:
- Fannie Mae's Refinance Application-Level Index (RALI) (Tuesday)
- MBA Weekly Applications Survey (Wednesday)
- Five Star Webinar: Getting Servicing Technology Approved: From Concept to Completion in 90 Days (Wednesday)
- Realtor.com Weekly Housing Market Recap (Wednesday)
- Freddie Mac Primary Mortgage Market Survey (Thursday)
- U.S. Department of Labor's Unemployment Insurance Weekly Claims Report (Thursday)
- Senate Banking Committee: The State of Housing 2023 (Thursday)