Morning Report: 2019 housing forecasts very similar to 2018 actuals

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S&P futures 2901.75 -8.75
Eurostoxx index 390.46 0.87
Oil (WTI) 65.29 1.29
10 year government bond yield 2.56%
30 year fixed rate mortgage 4.27%


Stocks are lower this morning as investors return from the long weekend. Bonds and MBS are flat.


There isn’t much in the way of market-moving data this week, although we will get some housing data with existing home sales, the FHFA House Price Index, and New Home Sales.


President Trump plans on ending the practice of allowing waivers for countries that import oil from Iran. Oil is up over a buck this morning on the news. China, India, and Turkey are Iran’s biggest customers.


The economy looks like it exited the first quarter with a pickup in growth, according to the Chicago Fed National Activity Index. The first quarter has been weak for the past several years, and it looks like that pattern repeated this year. Employment-related indicators drove the improvement in the index.


Fannie Mae is forecasting 2.2% GDP for 2019. On one hand, Fannie Mae expects to see growth impacted by the fading effects of the 2018 tax cuts and slowing corporate capital expenditures. On the other hand, they are forecasting a pickup in housing. Falling interest rates have been a pleasant surprise, and refinance activity is expected to be a bit higher than previously forecast. That said, prepayment burnout is pretty high at this point, and home price appreciation is probably going to drive refi activity more than interest rates.


“On housing, the recent dip in mortgage rates to their lowest level in over a year – combined with wage gains and home price deceleration – supports our contention that home sales will stabilize in 2019,” Duncan continued. “The greatest impediment to both sales and affordability continues to be on the supply side, as new inventory, particularly among existing homes, is being met quickly by strong demand – as evidenced by the already thin months’ supply hitting a new one-year low.”


Grant Thornton believes that a shortage of entry-level homes will be a constraint on the housing industry this year. “The escalating costs of materials have triggered production cuts; recent tariffs on imported materials, like lumber from Canada, have also pushed up costs at the same time that labor shortages have intensified,” Swonk wrote in her report. “The cheap labor – immigrants – that once made new housing affordable has all but disappeared.” They expect the median home price to rise 3.5% this year, compared to 4.8% in 2018. Existing home sales are expected to be unchanged at 5.9 million.

30 Responses

    • 2020 will be a “which cabal is less loathsome” contest.


    • And you may recall that Trump did surprisingly well in all of those states in November 2016. Funny, that.

      Because Russia made it happen. I’m sorry, but do these people listen to themselves?

      to let them know about potential Russian hacking and interference

      Hacking and interference. By which we mean Facebook ads and some money. And maybe doing something to get some emails from the DNC. Not actually doing anything to change or alter the vote totals or hack election machines or anything like that, because there is zero evidence of that.

      But I note again–essentially, Russia is being accused of staging a minor, Trump-support GOTV effort. And that means they ARE TRYING TO DESTROY AMERICA. And, of course, impeach Trump, because obviously.

      They idea that Russia has somehow posed a greater threat to our Democracy, now or in the past, than American politicians, is absurd. Was Russia behind CFR? Citizens United? Congress-critters keeping safes in their offices for bribes, back in the good old days?

      ABSCAM–was that Russia? WMDs in Iraq? Etc. Good golly.


    • Also, as always, if these exact same points of interaction and discussion had occurred amongst Democrats and Russia (and some probably did), and then HRC won, these same people would not be connecting the dots and screaming about collusion. We’d be hearing about the complicated nuances of conducting foreign policy ahead of being anointed to her predestined presidency.


  1. This is an interesting comparison.


    • Given that a bunch of high-profile Democrats used the same terms, it was obviously something they thought long and hard about.


    • This goes to the being completely out-of-touch, and is major evidence of their living-in-a-bubble syndrome. They are probably decades away from the Muslim population of America even potentially making a difference in their elections. There is literally no advantage or benefit to them to avoiding the word “Christian” like it was a profanity. But they do it any way. Because virtue-signaling to other members of their elite clique is more important the future electoral victory.

      To literally everybody but them, conspicuously avoiding an accurate description of the victim group when it’s Christians just sound weird. It’s off-putting. It sounds like an actual dog-whistle.


  2. I like Kevin Williamson’s writing a lot but this is just inexplicable. William Weld as the inheritor of the Goldwater-Reagan-Buckley tradition? Really?


    • McWing:

      Weld as the inheritor of the Goldwater-Reagan-Buckley tradition? Really?

      I read that judgment to be largely just a relative one, in the sense that any Republican who is not Trump would by default be that inheritor.

      My bigger objection is to his critique (implicit and explicit) of Trump as leading the nation into non-conservative territory, like “aggrandizing the executive at the expense of the other branches of government” or “abandon[ing] the notion of one-nation politics and committ[ing] themselves to a cold civil war”. I would say that, in these respects, Trump is simply recognizing and operating within an already existing reality. The executive has already been aggrandized at the expense of the other branches, so why not use it to advance, rather than limit, conservative ends? One-nation politics has already been abandoned, and the left is already waging a cold war against conservatives, so the choice is either fight back or capitulate. Preventing it is not an option.


      • Trump didn’t create it, but he does make it worse.


        • jnc:

          Trump both recognizes the existing reality and makes it worse.

          Possibly, but the relevant question is not whether he makes it worse than it already is, but rather whether he makes it worse than it would be given the alternative.


      • One nation politics ended when Bill Clinton shoved “No new taxes” up GHWB’s ass.


      • Just listening to last Thursdays No Agenda podcast, where Adam sets up a clip of Pelosi like she’s talking about Trump–and it sounds like she could be, except for not mentioning Russian collusion, although I immediately thought she sounded too young–and it turns out she was actually talking about H.W. Bush. But she could have been talking about Trump.

        Same damned playback, and the critiques are never serious. It’s always sports-team tribal, and while I know they disagree about policy, they’ve been pulling out “the other side is full of monsters and fools and demons” since time immemorial.

        And that clip was before the GOP took back the house for the first time in 40 years. Eh, they’re so full of hooey.

        If Williamson imagines that the left or Democrats would treat Weld any differently than they would Trump (especially if they managed to get Trump primaries with their constant attacks and conspiracy-mongering), he’s kidding himself. The only good thing about Weld–or any non-Trump Republican, to them–is that they aren’t in power.

        Want to become a racist, Russian-colluding, environment-killing, backstabbing, lying, double-dealing, election-stealing monster to the Dems? If you’re a Republican, win an election. Any election. That will do it.

        In all fairness, it tends to work in reverse, as well. Or that seems to be the case, to me.


      • Has Trump really made it worse than Dubya and Obama? I have a hard time seeing it. He’s made it less polite, and if we’re considering the slight increase of incivility and the absence of fact-checking-before-speaking as representing a compromise of conservative values then, maybe. But matching or even amping-up bipartisan tactics is the primary complaint, I’m not sure how it’s making anything less conservative.

        Sure, there’s using some non-conservative tools to advance conservative goals–and some non-conservative goals, as Trump is hardly a pure conservative, but neither was Dubya or H.W. or even my beloved Reagan. Who I still consider the best president in my lifetime and possibly since Jefferson.

        I’m not sure the purity test has much value in real life, because I don’t see how we’d ever get a president and congress that completely matched everybody’s ideal of pure conservatism. There are plenty of lefties (check the Plumline) who felt that Obama was center-right, not a reliable liberal.

        Most of the time, you take what you can get.


        • Every Republican since Eisenhower has been Literally. Hitler. to the left.


        • I’m not referring to civility, but rather this:

          “aggrandizing the executive at the expense of the other branches of government”

          Maybe “attempted to make it worse” might be more accurate.

          Liked by 1 person

        • Yeah, I see that, although I expect the same could have been mostly said about HRC, had she won. It seems to be the thrust of those in the executive branch, and the only thing that would restrain that would have to come from the other branches. I don’t see the executive branch ever seriously limiting its efforts and increasing and consolidating power.


        • KW:

          …and the only thing that would restrain that would have to come from the other branches.

          Exactly. I think a reasonable case can be made that the one thing most responsible for the aggrandizement of the executive is Congress itself, which has willingly and unconstitutionally delegated much of its power to the executive.


  3. It’s hard to describe how much I love this comment.

    I think what needs to be recognized is that based on what we know right now, they could impeach — RIGHT NOW.
    Congress have the basis to impeach without the Mueller report because Trump is in clear violation of the Emoluments Clause alone.  I would also say he could be impeached on meeting without record with a foreign adversary, and making inciteful commentary against a sitting member of Congress — thus endangering her life.
    This man has done so much under the broad authority of impeachment that one doesn’t really need the Mueller report to do so.
    Please log in or sign up to continue.
    smoothnmellow April 22 · 12:52:40


    • Spoken like a person who wouldn’t have to drag the party through a potential mine-field right before a big election year. Monday-Morning quarterbacks love to suggest others put themselves right in the line of fire for a doomed hail-mary pass.


    • I’m reading through the comments now, and am impressed how often polls are used as justification and evidence that only good things would come about for Democrats if they impeached. After the polls showing Hillary with a 98% chance of winning the presidency, that they put that much faith in the polls is . . . sweet.


      • similar to the press, the role of polling companies is threefold: 1) support the left, 2) demoralize the right, and 3) convince the undecided.

        It isn’t about accuracy – the people who pay these firms want their point of view to be amplified and are paying for these firms to create the illusion that their views are more popular than they actually are.

        Polling firms are just PR firms in drag

        Liked by 1 person

        • I couldn’t agree with you more and their first priority is to convince the Democratic base of their complete infallibility. In that they are identical to the US foreign policy establishment.


        • Most charitable explanation is that they are unaware or unconcerned with biases in their methods, and unable to admit how bad their past polling as been at predicting outcomes in many cases, and unable to adjust their polling methodologies to increase accuracy.

          Most charitable explanation.

          Either way, finding the polls meaningful is foolish. The pre-election polling that had HRC winning in the biggest landslide in US history should have been sufficient evidence of that, and I’ve certainly heard nothing about polling operations changing any of their methodologies in light of this abject failure of prediction . . . yet people, when it suits them, still put a lot of faith in the polls.

          And how are they polling? At best I think I’d be a neutral-to-negative on Trump’s job performance in almost any poll–if I am ever polled, and I haven’t been polled since I was 23 and lived in an apartment–but I’m not sure that’s indicative of how much I want a Democrat to win the presidency. I’d vote for Trump before Beto or Sanders or Harris or Warren or name-your-poison. Just because I don’t care for Trump doesn’t improve my opinion of the Democrats (or the GOP, for that matter).

          The polls are almost without meaning.


      • The Democrat’s ABSOLUTE faith in polling is amazing, but they’re the party of science so it makes sense.

        Liked by 1 person

        • They are indeed the party of science.

          Science being defined as (a) having a cellphone and a computer and spending lots of time on the Internet, (b) using some minimal jargon when discussing scientific subjects they have some vague awareness exist as real things, (c) referring to “science” as a category the same way devout religious person might refer to “the will of God”.

          They don’t evoke science as a set of clear rules and empiric evidence as much as some unknowable force of the universe that has anointed them one of the chosen people, and further discussion is unnecessary.


        • KW:

          They don’t evoke science as a set of clear rules and empiric evidence as much as some unknowable force of the universe that has anointed them one of the chosen people, and further discussion is unnecessary.

          The left uses the idea of science in exactly the same way it uses the idea of the Constitution.

          Liked by 1 person

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