On Tuesday of this week both the Dow and S&P 500 hit record closing highs and the Nasdaq hit the highest rate it has seen since September 2000. Stocks settled a little on profit taking. The Dow started November with a 15,615.55 close, up 0.29% from last week’s 15,570.28 close. The Nasdaq was down -0.54% for the week to 3,922.04 from last week’s 3,943.36. The S&P 500 was up 0.11% to 1761.64 after last week’s close 1,759.77. For the month, the Dow finished October at 15,545.57 up 2.75% from September’s 15,129.67 close and 18.7% from last October’s 13,096.46 finish. The Nasdaq was strong, closing at 3,919.71 up 3.93% from 3,771.48 last month and up 31.7% from October 2012’s 2,977.23 close. The S&P 500 closed out the month at 1,756.54, up 4.46% from last month’s 1,681.55 close and up 24.37% over October 2012’s 1,412.16 finish.
Interest rates continue to hold steady at lower rates. At this week’s Federal Reserve meeting, the Fed opted to continue with the bond-buying stimulus program. It looks like this program will remain in place at current levels until the government funding and debt ceiling are extended beyond January and February respectively.
According to the Freddie Mac Weekly Primary Mortgage Market Survey, the 30-year-fixed rate was down this week to 4.10% down slightly from last week’s 4.13%. This was the lowest rate seen since June. The 15-year-fixed dropped to 3.20% from last week’s 3.24%. A year ago the 30-year fixed was at 3.39% and the 15-year was at 2.70%. Today’s rates were around : 4.25% for a 30 year conforming, 3.25% for a 15 year conforming, 4.5% for a high balance 30 year conforming, 3.5 for 15 year high balance conforming, 4.625% for jumbo 30 year, and 3.625% for 15 year jumbo rates.
The 10-year Treasury note yield rate started November at 2.65% after ending October at 2.57%. It began October at 2.66% and was 1.72% at the end of October 2012.
Crude-oil stockpiles in the U.S. are heading toward a record high which is keeping the price of oil under $100 a barrel and we may see gasoline prices continue to fall over the next six weeks. An index compiled by the Institute for Supply Management reported that U.S. manufacturing remained strong in October, climbing to 56.4% the highest level since April 2011 and above economic predictions of a decline on account of the government shutdown.
The August report from Case-Shiller revealed that home prices around the country rose 12.8% compared to a year earlier, their fastest annual rate since February 2006. However comparing month to month the rate of growth is continuing to slow. The index rose 1.3% from a month earlier, down from a 1.8% rise seen in July. The report showed that average home prices around the country are around their mid-2004 levels but still roughly 20% below what they were in mid-2006 at the peak of the housing bubble.
The latest survey from the California Association of Realtors showed that 49.5% of homes in the state sold in 2013 were sold above the asking price (the median premium paid on these homes was 4.8%). The survey also showed that 72% of California homes received multiple offers this year, up from 57% in 2012. Also the share of international buyers rose for the third year in a row. It now stands at 8% of total sales and 34% of those international buyers were from China.
It does look like activity is very good. This is usually the time of year when activity slows, but the real estate market is more robust than I would have expected for this late in the year. Some areas are seeing another surge in price increases after looking like prices were leveling in August and September.
If you’d like more information on the San Fernando Valley or Los Angeles, or to have help looking for your next home, please feel free to reach out! I’m happy to help, no obligation.