Market News 12-6-19
Mortgage Market Update
The Fed meets next week for the last FOMC meeting of the year. A policy rate cut is not expected, but markets will be looking for signs of what may happen in 2020. Trade talks with China continue on a ‘phase one’ deal. A trade deal is expected to boost the global economy, and a deal announcement could pressure mortgage rates higher. The trade deficit dropped to its lowest level in nearly 1-1/2 yrs in October, suggesting trade could contribute to economic growth and higher rates in the 4th quarter.
Federal regulators expressed cautious optimism on the use of alternative credit models to expand access to credit and enable consumers to obtain more favorable rates and terms. CoreLogic reports that October house prices were up 3.5% year-over-year. Prices increased month-over-month by 0.5%. NAR forecasts the possibility of record low housing inventory in 2020. A shortage could lead to higher prices and make it even more challenging for buyers to find a home.