Buyers are going into the holiday season with their pick of the litter when it comes to home sales, and what better gift is there than the gift of a brand new home???

Instead of partaking in this year's Toyotathon, ask your local realtor if there are any Black Friday specials going on right now in your preferred neighborhood. I'd consider anything that's been on the market for over 100 days to be ripe for a Black Friday deal!

Unfortunately, mortgage rates don't have a Black Friday deal, but we are seeing rates fall this Monday morning! The average rate on a 30-year fixed rate conventional loan dipped slightly to 6.80% (down from 6.83% last week)! Sign up for our weekly Friday rate texts to see all the great options LendFriend provides to homebuyers! 

Light news week last week. Let's dig in.

Existing Home Sales Surprise

October existing home sales jumped the most in nearly 3 years. Before you start thinking that this news ruins my idea of getting yourself a Black Friday deal on a home, let's dig into the data.
 
First, these October home sales were from buyers who executed contracts in September (a time when interest rates were over 1% lower than they are today and at the lowest level in two years).

Second, available homes across the US as of the end of October hit 1.7M, a 11.8% increase year-over-year and that's not including off market listings or new construction!

Third, pending home sales in October are down 1.1%, thanks to higher mortgage rates.

There are however signs that this dip in home sales will be temporary. Many real estate service providers, like Zillow and Redfin, are reporting big upticks in traffic volume since the election. Redfin is reporting a 25% increase and we are seeing more buyer activity among our own clients who have been on sidelines for some time.

If you're looking for a deal in this market, it all depends on what neighborhood you're searching in. Working with a local expert can make a huge difference. If you need a referral, just let me know. I work with talented realtors all over the county.

Buy Now Pay Later Popularity Surges for the Holiday Season

In another sign that the economy isn't as hot as some may think, the Conference Board Leading Economic Index (LEI) continued to decline in October, off 0.4% after falling 0.3% in September. The overall decline has been 2.2% through the past six months.

“Apart from possible temporary impacts of hurricanes, the US LEI continued to suggest challenges to economic activity ahead,” the Board noted.

“Though we see a strong interest in shoppers buying for themselves using pay later plans this holiday, nearly two-thirds of consumers also plan to use flexible payment options for gifting,” Nandan Sheth, CEO of Splitit, said in a statement.  43% of consumers indicating they might reconsider making purchases if BNPL were not available

At a time when US credit card debt is at record highs, consumers are looking to credit card alternatives to help finance additional spending during the holiday season. I wonder when all this debt is going to actually get paid down.

So far, we are lucky we aren't seeing much inflation from stronger than expected retail sales. A 1.6% jump in sales at auto dealers drove much of the gain. Purchases climbed 2.3% at electronics and appliances stores and 0.7% at restaurants and bars. Though some of October’s rise in retail sales reflected higher prices, it mainly indicated increased purchases.

Chances of a Rate Cut Get Cut
 
As I reported last week, Powell doesn't love the idea of a rate cut in December. That's one of the reasons why we're seeing chances of a third rate cut fall to 55.9% right now (down from last week).

Remember that Trump doesn't much care for Powell (or the Federal Reserve as a whole). He believes that the president should have a greater say in where interest rates are heading, and his new pick for Treasury Secretary, Scott Bessent, seems to agree. 

Here's what Bessent said about replacing Powell - “You could do the earliest Fed nomination and create a shadow Fed chair. And based on the concept of forward guidance, no one is really going to care what Jerome Powell has to say anymore.” — Barron’s interview, Oct. 9. 

If he's confirmed, it will make for a very interesting 2025!