Federal Reserve - St Louis Real Estate News

St. Louis Real Estate: Inflation and Delinquency Trends Impacting Buyers and Sellers

By Dennis Norman, on October 15th, 2024

The latest report from the Federal Reserve Bank of New York highlights some key shifts in consumer expectations that could impact the St. Louis real estate market. While inflation expectations remain stable at 3.0% for the next year, medium- and long-term expectations have ticked up slightly. This suggests that buyers and sellers in St. Louis may face rising costs in the coming years, particularly as home price growth expectations hover around 3.0%, showing little movement. The labor market offers some reassurance, with more people feeling confident about finding a job if they lose one, but the rising likelihood of missed Continue Reading →

Fed Cuts Rates Amid Slowing Job Gains and Inflation Concerns

By Dennis Norman, on September 18th, 2024

The Federal Reserve made an important announcement today that could have a ripple effect on the real estate market in St. Louis and beyond. In their latest meeting, the Federal Open Market Committee (FOMC) decided to lower the federal funds rate by half a percentage point, bringing the target range down to 4.75% to 5%. This move comes as the Fed notes continued solid economic activity but acknowledges that job gains have slowed, and inflation, while improving, still remains above their 2% target.

For homebuyers and real estate investors, this rate cut could lead to a slight reduction in borrowing Continue Reading →

Federal Reserve Projections: What St. Louis Homebuyers and Sellers Need to Know

By Dennis Norman, on June 12th, 2024

The latest Federal Reserve Economic Projections, released on June 12, 2024, provide valuable insights into the future economic landscape that will impact homebuyers and sellers in St. Louis. The Federal Open Market Committee (FOMC) anticipates steady real GDP growth of around 2.0% from 2024 to 2026, which indicates a stable economic environment for making real estate investments. This projection is reassuring for those considering buying or selling homes, as economic stability often correlates with a steady housing market.

Interestingly, the unemployment rate is projected to hover around 4.1% during the same period, reflecting a healthy job market. For potential homebuyers, Continue Reading →

Refinance Activity Surges Despite Rising Mortgage Rates – Purchase Applications Fall

By Dennis Norman, on April 11th, 2024

Last week, the interest rates for 30-year fixed-rate mortgages climbed past the 7 percent mark. Despite this increase, as the chart below illustrates, there was a significant 10 percent increase in refinancing applications. This is in sharp contrast to a 5 percent decline in purchase applications. The growth in the refinancing segment is notable, representing 33.3 percent of the total application volume, up from 30.3 percent the previous week. This surge in refinancing interest is particularly intriguing, given the highest reported 30-year mortgage rates in over a month, at 7.01 percent.

Joel Kan, MBA’s Vice President and Deputy Chief Economist, Continue Reading →

Analyzing Jerome Powell’s Latest Press Conference: Implications for Mortgage Rates and the St. Louis Real Estate Market

By Dennis Norman, on December 14th, 2023

Federal Reserve Chair Jerome Powell’s press conference yesterday, along with the Federal Open Market Committee (FOMC) statement, provide crucial insights into the Fed’s economic outlook and monetary policy. These insights are pivotal for understanding the trajectory of mortgage rates and the St. Louis real estate market.

Powell’s Press Conference Highlights

Economic Activity and Rate Adjustments: Powell noted, “We have raised our policy interest rate by 5-1/4 percentage points… Our actions have moved our policy rate well into restrictive territory.” Housing Sector Observations: He remarked, “After picking up somewhat over the summer, activity in the housing sector has flattened out… largely Continue Reading →

Mortgage Rates Take a Slight Dip Amidst Steady Federal Reserve Rates

By Dennis Norman, on November 3rd, 2023

In the ever-evolving landscape of the housing market, prospective homeowners and investors alike keep a close eye on mortgage interest rates. Today, there was a modest decrease in the 30-year fixed-rate mortgage interest rate, now hovering between 7.5% and 7.6%. This shift comes in the wake of the Federal Reserve’s recent decision to maintain the Overnight Federal Funds Rate at a range of 5.25% to 5.50%.

This current rate represents a slight relief from the recent peak in , yet it remains a figure that echoes the rates of over two decades ago. To put this into perspective, the last Continue Reading →

Do the Fed Funds rate and M2 money supply really matter to the St Louis real estate market?

By Dennis Norman, on March 25th, 2023

For the past several months there have been many reports anticipating the moves of the Federal Reserve regarding interest rates then followed by tons of articles, blog posts and videos analyzing then predicting the impact of the Fed’s decision on the economy. The other popular topic in this area is the “Money Supply”, usually M2 money supply and whether it’s increasing or decreasing as well as the impact on the economy.

Should St Louis homeowners and potential home buyers really care about the Fed Funds rate or M2 money supply?

First, let’s talk about the Fed Funds rate and what Continue Reading →

The Coming Recession and Its Potential Affect on St Louis Home Prices

By Dennis Norman, on July 7th, 2022

Ever heard the expression “It’s not if, but when..”? That is something that I’ve heard for a while now about a recession. With everything that has happened to our economy including rising interest rates, rising inflation, the government printing more and more currency and running up greater debt, it seemed inevitable we would see a recession. To officially be in a recession, the GDP (Gross Domestic Product) has to fall for two successive quarters. For the first quarter of this year, GDP declined at an annual rate of 1.6%. The second quarter GDP numbers won’t be released until later this Continue Reading →

Interest Rates Hit Highest Level in Over 2-Years

By Dennis Norman, on February 12th, 2022

Mortgage interest rates were at 3.69% for a 30-year fixed-rate loan as of this past Thursday, February 10, 2022., according to Freddie Mac’s Primary Mortgage Market Survey®. As the chart below illustrates, mortgage interest rates hit a low of 2.77% in August of 2021 and have pretty much been trending upward since.

Within the last few days, there have been a lot of reports in the media projecting mortgage interest rates to go higher this year. A lot of it is based on the current inflation rates which are not good so if the economy and rate of inflation improve, Continue Reading →

Mortgage Interest Rates….How low can they go??

By Dennis Norman, on March 4th, 2020

For quite a while now we have enjoyed the positive effects on the real estate market from low mortgage rates but it looks like it’s going to get even better! Yesterday’s announcement by the Fed of the emergency step of lowering the benchmark U.S. interest rate by one-half of one percent, in an effort to offset the negative effect tot eh financial markets from the coronavirus will likely lead to even lower mortgage interest rates.

What’s the connection between the federal funds rate and mortgage interest rates? This is something often asked not only by homebuyers but is even within Continue Reading →

Strong Economy and Low Inflation Prompt Fed Reserve To Lower Interest Rates

By Dennis Norman, on August 1st, 2019

Yesterday afternoon, the Federal Reserve released a statement that was quite a vote of confidence for how the economy is doing. The Fed Reserve’s statement included “…the labor market remains strong and that economic activity has been rising at a moderate rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low.” and went on to say “Market-based measures of inflation compensation remain low;”.

As a result of the positive economic conditions, the Federal Open Market Committee announced it would lower the target range for the federal funds rate to 2 to 2-1/4 Continue Reading →

St Louis Home Prices Verses Rent Continues To Show Value In Home Prices

By Dennis Norman, on June 15th, 2017

There are several ways to look at home prices and home affordability as well as to argue the merits of homeownership versus renting, however, one my favorite metrics to consider along these lines is the relationship between home prices and rental rates. Most home buyers, that are seeking a home to live in, never consider what the home they are considering purchasing would rent for, since that is not their intended use. Continue Reading →

Home Affordability In St Louis Declining With Increasing Home Prices – Will Home Prices Suffer?

By Dennis Norman, on March 31st, 2017

It seems almost crazy to even throw out the idea of an adjustment in St Louis home prices or, perhaps even, any sort of slow down in the rate of home price appreciation given that the inventory of homes for sale is so low in so many parts of the St Louis area, however, maybe it’s something to look at. Continue Reading →

4 Reasons Why You Should Buy A Home Now In St Louis

By Dennis Norman, on February 14th, 2016

For those that have been reading my articles for a while, you know I am not a Pollyanna when it comes to the real estate market, opting instead to tell it like it is, even when the news is not so encouraging. For that reason, as well as the data behind my opinion, I think my suggestion that now is a good time to buy a home in St Louis should be considered to be a credible opinion from an industry insider. Continue Reading →

Mortgage Originations In 2nd Quarter Rise…4th Consecutive Rise Since 14 Year Low

By Dennis Norman, on August 13th, 2015

The Federal Reserve Bank of New York just released it’s Quarterly Report on Household Debt and Credit for the 2nd quarter of 2015 in which some encouraging facts were revealed with regard to the home mortgage market, including: Continue Reading →

St Louis Home Sales Are Up But Amount of Increase Varies Widely By Area

By Dennis Norman, on June 24th, 2015

Further proof of just how “local” real estate is and how important it is for home buyers and sellers to have accurate, targeted, local data is the fact that today the St Louis Business Journal reported “home sales increased 17.9 percent year to date in the St. Louis metropolitan area, more than twice the national rate of 8.4 percent” which would if you are looking to buy a home, say in the City of St Louis, may influence your decision thinking it’s a hot selling area. Continue Reading →

New Home Construction In Midwest Slips In May After Spike in April

By Dennis Norman, on June 16th, 2015

New Home Construction in the Midwest declined to a seasonally adjusted annual rate of return of 104,000 homes in May after hitting a rate of 123,000 homes in April. April’s increase in activity brought the rate of new home construction to 23% above a year ago, but in May the rate fell to a point 1% below the same time last year, according to newly released date from the U.S. Commerce Department and U.S. Census Bureau.

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New Home Construction In Midwest Surges in April

By Dennis Norman, on May 19th, 2015

New Home Construction in the Midwest really heated up during the month of may with construction beginning during the month on new single-family homes a the annual rate of 126,000 homes, an increase of 43.2% from March and an increase of 15.6% from April 2014, according to newly released date from the U.S. Commerce Department and U.S. Census Bureau. Continue Reading →

New Home Construction In Midwest Shows Mixed Results in March

By Dennis Norman, on April 18th, 2015

New Home Construction in the Midwest showed mixed results in March with a small increase from a year ago in the number of building permits issued but a decline in the number of new homes construction began on or was completed on, according to data released this week by the U.S. Commerce Department and U.S. Census Bureau. Continue Reading →

New Home Construction In St Louis Losing Steam

By Dennis Norman, on March 17th, 2015

New home construction in St Louis has begun 2015 with a slower start than one might expect given the spring-like weather St Louis experienced during much of January and the flurry of activity we have seen thus far this year from home buyers. Permits issued in January for new homes in the St Louis Metro Area were down 7.85 percent from a year ago, according to data from the Federal Reserve Bank of St Louis. Continue Reading →

St. Louis Borrowers in a Rush for Low Mortgage Interest Rates and Fees

By Dennis Norman, on March 7th, 2013

Nationwide 30-year fixed mortgage rates have climbed to their highest level of the last five weeks according to last week’s rate survey conducted by Bankrate.com. Continue Reading →

St. Louis New Home Construction Activity Continues to Increase; Fed Chairman Bernanke Warns of Moderate Reovery Though

By Dennis Norman, on November 20th, 2012

This morning, the Commerce Department released its new home construction report showing that, on a national basis, all aspects of new home construction, permits, starts and completions, are up double digits in October 2012 from the year before. The Home Builders Association’s new home report shows similar results in St. Louis as well with permits in St. Louis county up almost 24 percent in October from a year before, a 44 percent increase in St. Charles County and modest decreases in Jefferson County and Franklin County. Continue Reading →

How to apply for independent foreclosure review

By Dennis Norman, on May 29th, 2012

If you feel you were a victim of an improper foreclosure process in 2009 or 2010 by one of the companies below, you may apply for an independent foreclosure review and receive compensation if the independent review finds evidence of direct financial injury to you due to servicer error. Time is running out however as the deadline to apply is July 31, 2012. To make it easier to understand the process, the fed’s have produced a video on how to apply which I have included below. Continue Reading →

Fed Reserve Governor Duke on the "Prescriptions for Housing Recovery"

By Dennis Norman, on May 15th, 2012

Before you go getting too excited over my headline, I should point out that, even though Fed Reserve Board Governor Duke’s presentation today at the National Association of REALTORS mid-year meeting in Washington D.C. was titled “Prescriptions for Housing Recovery”, Governor Duke opened her remarks with “I wish I had such a prescription”. She went on to say that it is difficult to think of a single thing that, by itself will generate a sustainable recovery in housing. She did say, however, that she saw some policies that will help reduce the shadow inventory of houses in the foreclosure pipeline as well as improve the availability of financing to potential home buyers. Continue Reading →

Bank of America, J.P. MOrgan Chase, Wells Fargo, Citigroup and Ally Financial reach $25 Billion Agreement with Fed & State Government over Foreclosure Abuses

By News Desk, on March 12th, 2012

The Justice Department, the Department of Housing and Urban Development (HUD) and 49 state attorneys general announced today the filing of their landmark $25 billion agreement with the nation’s five largest mortgage servicers to address mortgage loan servicing and foreclosure abuses. Continue Reading →

Victims of bad foreclosure practices get more time to apply for review and possible compensation

By Dennis Norman, on February 14th, 2012

Last November I wrote about how victims of wrongful foreclosure could apply for an independent review of their file and possibly receive compensation under a new presented by acting Comptroller of the Currency, John Walsh. The deadline to apply for this was to be April 30, 2012, however, today, the Office of the Comptroller of the Currency announced they have extended the deadline to apply three months until July 31, 2012. Continue Reading →

Housing is cheap and can be an extremely attractive investment opportunity!

By Dennis Norman, on October 21st, 2011

Between interest rates falling to record lows and home prices falling back to levels from 8 years ago, the housing market is starting to look like a very attractive investment opportunity. Continue Reading →

REALTORS offer suggestions to the Fed on how to deal with the REO problem

By Dennis Norman, on September 16th, 2011

National Association of REALTORS® (NAR) President, Ron Phipps, wrote a letter to Shaun Donovan, Secretary of the Department of Housing and Urban Development, Timothy Geithner, Secretary of the Treasury Department and Edward DeMarco, Acting Director of the Federal Housing Finance Agency with suggestions on how to improve the Real Estate Owned (REO) asset disposition programs for Fannie Mae, Freddie Mac and FHA. NAR, like many other housing related associations and organizations, submitted letters in response to the government’s request for information on how to deal with the REO problem.

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Converting REO’s to rentals could help housing recovery according to Fed Official

By Dennis Norman, on September 8th, 2011

Federal Reserve Governor Elizabeth A. Duke, while speaking at the Federal Reserve Board Policy Forum last week, discussed the effect on the housing market that properties acquired by banks and lenders through foreclosure (REO’s) and suggested that if some of this inventory was converted to rental property by the lenders, this may have a positive effect on the housing market.

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Feds Take Action Against Banks for Misconduct and Negligence Related to Mortgage Loan Servicing and Foreclosure Practices

By Dennis Norman, on April 17th, 2011

Over the past year or so there have been dozens, if not hundreds, of stories questioning the manner in which lenders were handling the servicing of their loans, particularly those of underwater borrowers, as well as the foreclosure practices of many including “robo-signing” of foreclosure affidavits. Next came the lawsuits and now, this week, the Federal Reserve Board announced formal enforcement actions requiring 10 banking organizations to address “a pattern of misconduct and negligence related to deficient practices in residential mortgage loan servicing and foreclosure processing.”

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