In this Friday market briefing, Jordan Keck provides a concise overview of current mortgage and housing market conditions. He notes a slight uptick in average weekly mortgage rates to 6.27% and offers a practical tip distinguishing appraisal‑required repairs from underwriter‑required repairs, highlighting procedural differences and cost implications. Keck reviews the September PCE inflation report, which showed a 0.3% month‑over‑month rise and a core year‑over‑year rate of 2.8%, emphasizing its limited market impact due to timing. He discusses the pending Federal Reserve chair transition, outlining the three leading candidates (Waller, Hassett, Warsh) and how market expectations may shape price reactions. The update then covers Apartment List data indicating a fourth consecutive month of rent declines (1% month‑over‑month, 1.1% year‑over‑year) and a record‑high vacancy rate of 7.2%. Keck reports ADP’s November employment figures, revealing a net loss of 32,000 jobs, with small businesses shedding 120,000 positions and professional services bearing the brunt of losses. Finally, he presents Cotality’s Home Price Index for October, showing a 0.2% monthly dip but a modest 1.1% year‑over‑year gain, and a forecasted 4.3% price increase over the next year predicated on anticipated rate cuts. Throughout, Keck encourages listeners to reach out with questions and reminds them to plan for holiday closures.
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Good morning and happy Friday. Jordan Keck here, your lender buddy, with your weekly market update back to you here after the Thanksgiving break. Hopefully had a great time there, and then crazy to think about Christmas already coming up here in a few weeks. So be sure you're planning for both Christmas Day and for New Year's Day as federal holidays, so no closings then. And of course, the days before and after, usually pretty quiet. So sometimes reduced, uh, recording cutoff times for those depending on the county. So again, just make sure you're planning accordingly and not trying to squeak too much into too little time. As far as weekly rates moving up slightly this week from 6.22% on average to 6.27% as the average for lenders across the country for the top tier scenarios with a small amount of points for buydown. So not huge changes there. As far as weekly mortgage tip, wanting to talk about appraisal required repairs versus underwriter required repairs. Now, this is something that if you've been around for a while, you've seen several times where the appraiser might not call out any specific repairs required for the loan, but after reviewing it, the underwriter comes back and says they will require repairs. So the couple differences on this, the underwriter ultimately has the final say to require repairs on something, but it's going to be based on the appraisal report. A good example, I have one this last week where the appraiser said it was good with, let's say, 4 items to be fixed, but they made note that other items may be potential health or safety risks, or that there was excessive deferred maintenance. And even though they didn't require it as part of their report, the underwriter sees that, and then it's their judgment call to determine if those need to be done. The nice part though, if it's appraisal required repairs, they will have to go back out to the property, request an appraisal re-inspection report, which you have to pay for. But if it's an underwriter required repair, that typically does not need the appraiser to go back out, and they can use pictures or invoices or receipts to be able to sign off on those repairs. So oftentimes as well, those can be made prior to funding conditions. You can get final approval, get to docs. and then make sure that those are provided in order to fund. Now next up, PCE, personal consumption expenditures inflation report for September, came in rising 0.3%, which was in line with estimates. This is a bit of an old report, mind you, because the government shutdown has delayed things, so market didn't really react in part because it came in pretty much as expected, but also because it's pretty old news at this point. We don't know when the October report is going to be released, But in the meantime, year over year for September rose from 2.7 to 2.8 as expected. The core reading, which is what the Fed watches the most, rose 0.2% as expected. Really the only thing different was that the year over year core rate fell from 2.8, rose, excuse me, 0.2% to 2.8, which is slightly lower than expectations. So overall pretty tame report, good for us, but a little bit old, so not very market moving. Next, we have President Trump announced that he has made his pick for the next Fed chair of the Federal Reserve. So Jerome Powell will be out at the end of his term here, beginning part of 2026. And to replace him, there are 3 most likely candidates here. They said that the announcement will be made before Christmas. We don't know when it will be made. My guess is sometime in the next week, week and a half here, because they've already made the decision. Now it's just a matter of making the announcement. Now, the market has already factored in the likely preferences of the front-runners to be able to cut rates in the future. So once somebody's announced, if the markets essentially say, oh, we think they're going to cut rates, that's going to be priced in almost immediately at the announcement. Currently, the market's expecting a 50% chance that it's going to be Waller, 33% chance it's Hassett, and 15% chance it's Warsh. And if it does end up being worse, that means the market has to react more because they didn't really expect him to be chosen. Or if it is Waller, then the market's basically already priced in that expectation. So just know they're only going to react when it's a surprise compared to what the market expected. Next up, apartment list November reports showed rents fell 1% for the month. This is the fourth straight month of declines, and rents are now down 1.1% year over year. This is lower than the 1% decline in October, showing that the decrease is accelerating and has been declining on a year-over-year basis for the last 2.5 years. A big reason for the decreasing rents is increasing vacancy rates, which remain at 7.2%. This is the highest level on record since ApartmentList has started tracking vacancies, and the average time on market rose from 34 days last year to 36 days this year, also adding pressure on those rents. ADP's employment report for November came in showing 32,000 job losses net, below the 10,000 to 40,000 job gains that was expected. So this was a big miss on that report. The last 4 months combined, there have been a total net loss of 17,000 jobs. Even though some of them have come in with job gains, the net over the last 4 months is still negative. Within this report, small businesses lost 120,000 jobs, whereas medium and large-sized businesses have had small gains. Now, the big sector of losses was in professional and business services. Those that saw some gains were leisure and hospitality. And lastly here, Cotality's Home Price Index for October showed home prices declined 0.2% nationally for the month. Year-over-year values are still up 1.1%, but this is a decrease from previous levels. We've been seeing it decelerate And this is the lowest reported growth level since 2012. They do forecast ahead a positive number though, anticipating a 4.3% increase in home prices in the coming 12 months, mostly due to a belief that interest rates would drop and that would lead to stronger demand. As always, hopefully this report is helpful for you. If you have questions on any topics or any clients that I can help you with, let me know. Happy to be able to I help wherever I can. Have a great weekend. We'll see you next time. Take care.
