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Below is the Conejo Market Report for May 2016 detailing local real estate market statistics and including year-over-year data:

Conejo

Stocks lower this week – Stock markets have dropped in the last 6 sessions. Investor’s fears are over next Thursday’s British referendum to leave the European Union. It is unknown what impact it will have if the referendum passes, but many investors feel it will harm the European economy and thus hurt corporate profits. Some believe that if the British break away from the European Union others will follow. The Dow Jones Industrial Average closed the week at 17,675.16, down from 17,865.34 last Friday. The S&P 500 closed the week at 2,071.22, down from 2,096.07 last week. The NASDAQ closed the week at 4,800.34, down from last week’s close of 4,895.55.

Bond yields remain near 3-year low – The 10 year U.S. Treasury bond yield closed the week at 1.62%, down slightly from 1.64% last Friday. The 30-year U.S. Treasury bond closed at 2.44%, also down from 2.44% last week. Mortgage rates follow bond rates so we watch bond rates carefully.

Mortgage rates at 3-year low – The Freddie Mac Primary Mortgage Survey released on June 16, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.54%. The 15-year fixed average rate was 2.81% The 5/1 ARM average rate was 2.74%. Bond yields dropped at the end on the week so rates could be even lower next week.

California’s unemployment rate dips to 5.2% – The Employment Development Department reported that California employers’s added 15,200 net new jobs in May. While the number of new jobs added was below what analysts expected, the unemployment rate fell from 5.3% in April to 5.2% in May. The unemployment rate in May 2015 was 6.4%, so being at 5.2% is a 1.2% drop year over year!

Federal Reserve leaves rates unchanged in June – Amid worries of slowing job growth, The Federal Open Market Committee declined to raise it’s interest rate target at this week’s two day meeting from 0.5%. Fed chairperson, Janet Yellen signaled late last year that there could be as many as 6 increases in 2016. As the labor market growth has slowed and economic growth no longer at last year’s levels, Fed officials are signaling that there may only be one or two increases in 2016.

California existing home sales and prices up in May – The California Association of Realtors reported that existing home sales in California totaled 410,190 in May on a seasonally adjusted annual rate. That is up 0.6% from April and down 3.2% from last May. Tight inventory has impacted the number of sales, as there was just a 3.4 month supply of homes on the market in May, down from 3.5 months in April. A 6-7 month supply is considered normal. The median price paid for a single family home in California rose to $518,760 in May from $509,590 in April. 

Have a great weekend!
Syd  

Stocks hit 2016 highs on Wednesday and lost all the gains at the end the week – Stock market indexes hit their highest levels in 2016 on Wednesday, only to fall Thursday and Friday to end the week pretty much unchanged. The week started off with comments from Fed chairperson, Janet Yellen, which led investors to believe that an interest rate hike soon would no longer occur after last Friday’s weak jobs growth report. This was good news to investors as higher interest rates increase borrowing costs which reduce profit. On Thursday the labor department reported that jobless claims dropped by 4,000 for the week, suggesting that the labor market was stronger than last week’s report implied. On Wednesday oil hit the highest price per barrel since last July toping $51 a barrel after bottoming out in February at $27 a barrel. This helped stocks as rising oil prices helps energy stocks and economies in oil producing areas where low prices have led to cuts in production. The number of new rigs increased for the second straight week. Unfortunately, on Thursday and Friday oil prices dropped back down to about $49 a barrel. stocks retreated, losing all the gains for the week. The Dow Jones Industrial Average closed the week at 17,865.34, up from 17,807.06 last Friday. The S&P 500 closed the week at 2,096.07, unchanged from 2,099.13 last week. The NASDAQ closed the week at 4,895.55, down from last week’s close of 4,942.52.

Bond yields drop – The 10 year U.S. Treasury bond yield closed the week at 1.64%, down significantly from 1.85% on May 31. The 30-year U.S. Treasury bond closed at 2.44%, also down from 2.63% at the end of May. Mortgage rates follow bond rates so we watch bond rates carefully.

Mortgage rates drop to 3-year low – The Freddie Mac Primary Mortgage Survey released on June 9, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.60%. The 15-year fixed average rate was 2.87%. The 5/1 ARM average rate was 2.82%. Bond yields dropped at the end on the week so rates could be even lower next week.

U.S. job growth slows as only 38,000 new jobs added – unemployment rate drops to 4.7% – The Labor Department reported that employers added 38,000 net new jobs in May. It was the lowest number of new jobs for any month since April 2010. The number was actually better than 38,000 as the Labor Department counted 35,000 striking Verizon workers as unemployed who are now back to work. They will be added to next month’s job gains. Even with the additional 35,000, the number of new jobs was well below what experts had anticipated. Job growth averaged over 200,000 a month in 2014 and 2015. Over the past 3 months, job growth has averaged 116,000 a month. Even more surprising was that the unemployment rate fell to 4.7%, down from 5% in April, as workers left the workforce who were discouraged and gave up on finding a job. On a positive note hourly wages rose 0.2% from April and were up 2.5% from last May. 

Stocks rise on positive news – The Commerce Department raised its estimate of the first quarter U.S. Gross Domestic Product to a 0.8% annual increase from the previously reported estimate of 0.5%. The National Association of Realtors reported that U.S. pending home sales reached the highest level in a decade. Consumer confidence rebounded, and oil rose to almost $50 a barrel ending the month at $49.10 a barrel, up 6.9% from $45.92 at the end of April. The factor that seemed to hold the market down in May was the Federal Reserve minutes, which revealed that The Fed might raise their benchmark Funds Rate as early as June. The Dow Jones Industrial Average closed the month at 17,787.31, up from 17,763.64 last month. The S&P 500 closed the month at 2,096.95, up from 2,065.30 on April 30. The NASDAQ closed May 31 at 4,948.05, up from 4,775.36 at the end of April. 

For the week ending June 4, 2016 – The Dow Jones Industrial Average closed the week at 17,807.06. The S&P 500 closed at 2,099.13. The NASDAQ closed at 4,942.52.

Bond yields unchanged in May – The 10 year U.S. Treasury bond yield closed May 31 at 1.85%, up from 1.83% last month. The 30-year U.S. Treasury bond closed at 2.63%, up from 2.66% at the end of April. Mortgage rates follow bond rates so we watch bond rates carefully.

Retail sales surge in April – The Commerce Department reported that U.S. retail sales recorded their biggest increase in a year as consumers stepped up purchases of automobiles and other goods in April. This report suggested that the economy may be gaining momentum after a disappointing first quarter. Retail sales surged 1.3% in April. It’s largest gain since March 2015. Coming just days after Macy’s and Nordstrom’s reported poor first quarter sales, this report suggests that fear of consumer spending slowing sharply may have been over exaggerated. 

Consumer sentiment rebounds in May – The University of Michigan reported that its index of consumer sentiment rose to 94.7 in May, up from 89 in April. It’s the highest reading in a year, signaling that consumers have grown more optimistic about the economy. It is thought that more confidence could bring greater economic growth, as consumers are more likely to spend. Consumer spending accounts for roughly 70% of U.S. economic activity. The economy slowed the first three months of the year as confidence dropped. Most analysts expect growth to rebound in the April to June quarter. 

Consumer spending rises – The Commerce Department reported that consumers spent more in April as consumer spending rose 1% for the month, the largest gain in seven years. The increase was the largest monthly jump since August 2009 and beat analysts’ expectations of 0.7%, as consumers bought cars and trucks and other goods.

Homes more affordable in the first quarter – The California Association of Realtors reported that housing affordability in the state improved in the first quarter. Strong wage growth, lower interest rates and leveling home prices pushes housing affordability higher. According to C.A.R. 34% of California households could afford to purchase a $465,280 median priced home. The income required to purchase a median priced home was $92,571. This was up from the fourth quarter of 2015 when only 30% of households could afford to purchase a median priced home. Condos and town-homes were even more affordable with 41% of households able to afford a condo or town-home. The income needed to purchase the median priced condo or town-home was $77,575. 

California statewide median price breaks $500,000 – The California Association of Realtors reported that the median price of a home in California rose to $509,100 in April. That represents a 5.3% month over month increase from March. 

California home re-sales fewer due to tight inventory – The California Association of Realtors also reported that the number of homes sold in April dropped 2.6% from its annualized level in March. Year over year the number of sales declined 5.4% from April 2015. The Unsold Inventory Index dropped again to a 3.5 month supply in April. A normal market is a 6.1 month supply, so inventory levels are around 60% of normal, according to CAR. This tight inventory is pushing prices higher and sales lower as buyers are again finding it tough to find homes to buy. 

U.S. pending home sales at 10 year high – The National Association of Realtors announced that April pending home sales rose for the third consecutive month. April’s 5.1% rise in pending home sales from March brings the number of homes that went under contract to the highest level in a decade. The pending home sale index is a leading indicator of housing activity. It is based on signed real estate contracts for existing single-family homes, condominiums, and co-ops. Because homes go under contract a month or two before they close the index is a leading indicator of what closed sales figures will look like in the future.

Mortgage rates slightly higher than last week – The Freddie Mac Primary Mortgage Survey released on June 2, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.66% The 15-year fixed average rate was 2.92%. The 5/1 ARM average rate was 2.88%.

Have a great weekend!
Syd

Stocks rise on positive news – This week The Commerce Department raised its estimate of the first quarter U.S. Gross Domestic Product to an 0.8% annual increase from the previously reported estimate of 0.5%. The National Association of Realtors reported that U.S. pending home sales reached the highest level in a decade. Consumer confidence rebounded, and oil rose to almost $50 a barrel. The Dow Jones Industrial Average closed the week at 17,873.22, up from 17,500.94 last week. The S&P 500 closed the week at 2,099.06, up from 2,052.32 last week. The NASDAQ closed Friday at 4,933.50, up from 4,769.56 last week. 

Bond yields unchanged – The 10 year U.S. Treasury bond closed Friday yielding 1.85%, unchanged from 1.85% last week. The 30 year U.S. Treasury bond closed Friday yielding 2.65%, also pretty much unchanged from 2.63% last week. Mortgage rates follow bond yields so we watch bonds carefully. 

Mortgage rates slightly higher than last week – The Freddie Mac Primary Mortgage Survey released on May 26, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.64% The 15-year fixed average rate was 2.89%. The 5/1 ARM average rate was 2.87%.

U.S. pending home sales at 10 year high – The National Association of Realtors announced that April pending home sales rose for the third consecutive month. April’s 5.1% rise in pending home sales from March brings the number of homes that went under contract to the highest level in a decade. The pending home sale index is a leading indicator of housing activity. It is based on signed real estate contracts for existing single family homes, condominiums, and co-ops. Because homes go under contract a month or two before they close the index is a leading indicator of what closed sales figures will look like in the future.

Consumer confidence rebounds in May – The University of Michigan reported that its index of consumer sentiment rose to 94.7 in May, up from 89 in April. It’s the highest reading in a year, signaling that consumers have grown more optimistic about the economy. It is thought that more confidence could bring greater economic growth, as consumers are more likely to spend. Consumer spending accounts for roughly 70% of U.S. economic activity. The economy slowed the first three months of the year as confidence dropped. Most analysts expect growth to rebound in the April to June quarter. 

Have a great weekend!

Syd

Stocks mixed this week – Stocks climbed Monday, only to be pulled back after The Federal Reserve released minutes from the April meeting suggesting a possible interest rate hike as early as their June meeting. The Dow Jones Industrial Average closed the week at 17,500.94, down from 17,535.32 last week. The S&P 500 closed the week at 2,052.32, up slightly from 2,046.41 last week. The NASDAQ closed Friday at 4,769.56, up from 4,717.68 last week.

Bond yields rise after Fed minutes suggest rate hike possible in June – The 10 year U.S. Treasury bond  closed Friday yielding 1.85%, up sharply from 1.71% last week. The 30 year U.S. Treasury bond closed Friday yielding 2.63%, also up from 2.55% last week. Mortgage rates follow bond yields so we watch bonds carefully. 

Mortgage rates inch up from 3-year low– The Freddie Mac Primary Mortgage Survey released on May 19, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.55% The 15-year fixed average rate was 2.81%. The 5/1 ARM average rate was 2.80%.

California state-wide median price breaks $500,000 – The California Association of Realtors reported that the median price of a home in California rose to $509,100 in April. That represents a 5.3% month over month increase from March. 

California home re-sales fewer due to tight inventory – The California Association of Realtors also reported that the number of homes sold in April dropped 2.6% from its annualized level in March. Year over year the number of sales declined 5.4% from April 2015. The Unsold Inventory Index dropped again to a 3.5 month supply in April. A normal market is a 6.1 month supply, so inventory levels are around 60% of normal, according to CAR. This tight inventory is pushing prices higher and sales lower as buyers are again finding it tough to find homes to buy.

Have a great weekend!

Below is the Westside Market Report for April 2016 detailing local real estate market statistics and including year-over-year data:

Westside

Below is the San Fernando Valley Market Report for April 2016 detailing local real estate market statistics and including year-over-year data:
San Fernando Valley

Below is the Conejo Valley Market Report for April 2016 detailing local real estate market statistics and including year-over-year data:

Conejo Valley

Stocks drop again this week – Stocks dropped again this week as a new round of first quarter corporate earnings reports showed consumers pulled back sharply on purchases. Retail sales were particularly weak, as companies revised their outlooks downward for the remainder of the year. Late Friday the Commerce Department released April retail sales figures which showed that sales rebounded. It will be interesting to see how this affects the opening of the market on Monday. The Dow Jones Industrial Average closed the week at 17,535.32, down from 17,740.63 last week. The S&P 500 closed the week at 2,046.61, down from 2,057.41 last week. The NASDAQ closed Friday at 4,717.68, down from 4,736.16 last week. 

Bond yields lower again this week – The 10 year U.S. Treasury bond closed Friday yielding 1.71%, down from 1.79% last week. The 30 year U.S. Treasury bond closed Friday yielding 2.55%, also lower than 2.62% last week. Mortgage rates follow bond yields so we watch bonds carefully. 

Mortgage rates drop to 3 year low – The Freddie Mac Primary Mortgage Survey released on May 12, 2016 showed that average mortgage rates from lenders surveyed for the most popular mortgage products were as follows: The 30-year fixed rate average was 3.57%. The 15-year fixed average rate was 2.81%. The 5/1 ARM average rate was 2.78%.

Retail sales surge in April – The Commerce Department reported that U.S. retail sales recorded their biggest increase in a year as consumers stepped up purchases of automobiles and other goods in April. This report suggested that the economy may be gaining momentum after a disappointing first quarter. Retail sales surged 1.3% in April. It’s largest gain since March 2015. Coming just days after Macy’s and Nordstrom’s reported poor first quarter sales, this report suggests that fear of consumer spending slowing sharply may have been over exaggerated. 

Homes more affordable in the first quarter – The California Association of Realtors reported that housing affordability in the state improved in the first quarter. Strong wage growth, lower interest rates and leveling home prices pushes housing affordability higher. According to C.A.R. 34% of California households could afford to purchase a $465,280 median priced home. The income required to purchase a median priced home was $92,571. This was up from the fourth quarter of 2015 when only 30% of households could afford to purchase a median priced home. Condos and town-homes were even more affordable with 41% of households able to afford a condo or town-home. The income needed to purchase the median priced condo or town-home was $77,575.

Have a great weekend!

Syd