Hi neighbor,
Today I will be sharing with you our perspective on the local real estate market here in Houston, Texas, specifically a market update for the neighborhood of Oak Forest. Whether you are looking to buy, sell, or just keep an eye on the market, we look forward to being your resource.
What is happening in the real estate market in Oak Forest?
We currently have 30 homes pending, with 7 homes sold in the last two weeks, averaging a sale price of $318 a square foot. Seven homes sold over the asking price.
Compared to the two weeks prior: Homes sold are slightly down from 15 sold, but the average sales price per square foot is up to $318 ($292 previously). Every home is different, with different features, so don’t forget to ask us for your annual equity review if you are curious about your personal home. You can text AER to 79564 or email us here.
If we look at how fast the move-in-ready (modern) homes are going (must not be overpriced), the demand in this area has not surpassed the supply, making it still a great time to sell. Buyer agents around Houston are seeing a slow in the real estate market, but it isn’t affecting every neighborhood. I know the interest rates rising has been one deterrent from some buyers purchasing right now, but that isn’t your ideal buyer anyways!
The most desirable homes in the area are still selling the first weekend or first week they hit the market (a really good coming soon campaign, like we do at Jo & Co. allows you to sell faster, for more money).
Check out the graphic below for a larger overview of the real estate market for the last two weeks in Oak Forest.
What I have gathered…
Dual Inflation Rates
Last week, the Consumer Price Index (CPI) for August saw a 0.6% monthly increase, pushing the annual rate to 3.7%—both figures exceeding predictions. The monthly jump was the most significant for the year, largely fueled by rising energy costs. Oil prices jumped almost 11% during August, as the cost per barrel rose from $65 to $89 between June and September.
On the other hand, the Core CPI—which omits food and energy costs and is more keenly observed by the Federal Reserve—fell from 4.7% to 4.3% year-over-year, showing signs of moving in a favorable direction.
Following the release of this news, the 10-year Treasury Note yield retreated from 4.35% to 4.25%, indicating that the bond market and interest rates found the Core CPI decline encouraging.
Peaks in 2023 Oil Prices
As stated, the primary driver for August's inflation uptick was the surge in oil prices, which have continued to climb, reaching new highs for 2023 last week. If this trend persists, we can anticipate that the CPI for September will also reflect elevated headline inflation, confirming that inflation reached its nadir in June.
The Silent Phase Persists
As the Federal Reserve's upcoming meeting looms, its officials are refraining from public comments on monetary policy. This period of quietude has helped to stabilize interest rate fluctuations and maintain rates below 2023 highs. Expect changes in the week ahead.
Presently, Fed Fund Futures, which gauge the likelihood of interest rate adjustments, predict an almost certain chance of no rate hike during this meeting.
Rising Rates in Japan
Global interest rates have been ticking upward, and Japan has followed suit. With inflation hitting four-decade highs in the country, Japan's Central Bank has permitted their 10-year government bond yield to reach 0.7%, the highest since 2014. If this trend continues, it could exert upward pressure on worldwide yields, including the U.S. 10-year Note.
The Bottom Line
Interest rates are near their yearly highs, and there's a potential for accelerating headline inflation, particularly due to energy costs. Monitoring this will be crucial in the coming months, as any uptick in inflation could compel the Fed to further raise rates.
Looking Ahead
This Wednesday, the Federal Reserve will disclose its Monetary Policy Statement and interest rate decisions. Prior to the silent phase, several Fed members emphasized the need for “patience” and a likely “pause” in further hikes, pending economic developments. Market sentiment suggests no rate hike this week and a 50/50 likelihood of one in November.
Mortgage Market Outlook
Mortgage bond prices set the stage for home loan rates. The accompanying one-year chart showcases the Fannie Mae 30-year 6.0% coupon, which serves as the basis for currently closed loans. Rising prices correlate with lower rates and vice versa.
The chart indicates attempts to stabilize above the lowest prices of 2023, which could lead to additional improvement in rates if sustained. Nevertheless, if bond prices dip below $99, we may see another uptick in home loan rates.
Chart: Fannie Mae 30-Year 6.0% Coupon (Friday, September 15, 2023)
What is happening in the real estate market nationally?
Mortgage application submissions slipped slightly. Inflation on the consumer price index (CPI) had mixed signals in August. Continuing and initial jobless claims increased. Retail sales climbed higher in August.
| MORTGAGE RATES CURRENTLY TRENDING | THIS WEEK'S POTENTIAL VOLATILITY |
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Notable News
- Resumption of student loan payments will be a financial shock for many renters. Read Now >>
- Best week to buy is coming up, according to Realtor.com chief economist. Watch Now >>
- FHA Chief speaks on why it should be easier to get a mortgage. Read Now >>
Market Recap
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Mortgage application submissions decreased a composite 0.8% during the week ending 9/8. The Refinance Index decreased 5% while the seasonally adjusted Purchase Index increased 1%.
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Inflation on the consumer price index (CPI) increased 0.6% month-over-month in August, which was right in line with expectations. Annual inflation was at 3.7%, which was slightly higher than expectations. Inflation on the core CPI index, which strips food and energy costs, increased 0.3%, which was slightly above expectations. Annually, the index was in line with expectations at 4.3%.
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Continuing jobless claims were at a level of 1,688,000 during the week ending 9/2, an increase of 4,000 from the week before. During the week ending 9/9, initial jobless claims were at a level of 220,000, an increase of 3,000 from the week before.
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Retail sales increased 0.6% in August, much higher than 0.2% expected – which is in line with higher inflation levels.
Review of Last Week
SIDEWAYS… For the week, stocks essentially went nowhere, the Dow up a tick, the S&P 500 and Nasdaq off a bit, as traders reacted to an economic situation that's not terribly positive, nor horribly negative.
Take August CPI inflation. The headline 3.7% annual rate was up from 3.2% in July, but core inflation, excluding food and energy prices, headed down from 4.7% to 4.3%. Of course, these are both well above the Fed's 2% target.
August Retail Sales were up 0.6%, though that was fueled by a 10.6% spike in gas prices. Similarly, Industrial Production was up in August, but Friday the future was clouded by the UAW strike at the three major automakers.
The week ended with the Dow UP 0.1%, to 34,619; the S&P 500 down 0.2%, to 4,450; and the Nasdaq down 0.4%, to 13,708.
Bonds didn't move much either, off a smidge overall, with the 30-Year UMBS 6.0% ending unchanged, at $99.29. The national average 30-year fixed mortgage rate inched up by a miniscule amount in Freddie Mac's Primary Mortgage Market Survey. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
DID YOU KNOW… A new survey from an online real estate database found that one in ten of today’s home sellers were motivated to move because their employers instituted new onsite work requirements.
Market Forecast
HOME BUILDING, EXISTING HOME SALES, THE FED… August Housing Starts are expected to come in a little lower than July's number, as builders have plenty of work already on their plates. But they're not slacking off for the future, as August Building Permits are forecast to hit the same pace as July. Wednesday, the Fed will reveal its FOMC Rate Decision, and the prediction is no hike for now.
Summary
CoreLogic Home Price Insights showed home prices accelerated in July, up 2.5% annually, after 1.6% yearly growth the prior two months. Prices have now risen annually six straight months, and are 5% above their February low.
According to the National Association of Home Builders, nearly a third of all listings in July were new construction. Historically, new homes have accounted for only about 10% to 15% of the market.
A national real estate investment company’s data revealed many flippers are snatching up vacant, dilapidated homes and renovating them, adding turnkey inventory that is 30% to 40% less expensive than new construction.
Can we sell yours?
So if you are in need of a listing agent, we would love the opportunity to see your home and meet you of course. My husband, Edward, and I, look forward to being the brokerage and team for you! You can reach out to us via email: [email protected] & [email protected] or telephone: 832-493-6685.
Read more:
If you are curious ‘How to get more money for your home when listing it for sale', check out this blog post.
I hope you have found this blog post super helpful. If there is anything else we can do for you, including helping you sell (or buy) a home, I would be honored to assist. I hope you have a great day/evening. Cheers, E + J.
We are so happy you found our little corner of the interwebs. We look forward to y'all reaching out to us. We love to answer questions and welcome them. Recently we created some local maps, and you can download those by clicking the image/link above. Below, you will find an index of some very helpful information to assist you in learning more about the Houston suburbs. If you are relocating to our neck of the woods, we hope you reach out to us, because we would love to help you by being your local realtor and friend. Thoughtfully written for you. Hugs, Jo.
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If you are overwhelmed..
Now if you are feeling overwhelmed on where you should plant your roots, I would love to talk to you. You can schedule a call with me by click this link: http://byjoandco.com/call or just send us an email: [email protected]. There are some amazing communities all over the Houston suburbs. In this post, https://search.byjoandco.com/blog/best-neighborhoods-in-houston/, I deep dive into all the different suburbs/neighborhoods that you might want to consider, and why. There are many resources here, so please reach out if you are curious what to look at next! Thank you for trusting us.
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