Page 3 - Market Outlook Q3 2024

Q3, 2024
3

Economic Overview

Federal Reserve Projected to Cut Rates by 25 Basis Points at
Next Two Meetings…Continued from Page 1

Consumer Sentiment Remains Weak but Hopeful Regionally, most areas saw a drop in sales, except the West, where sales
increased by 4.1%. The Northeast, Midwest, and South all saw declines.
According to the University of Michigan’s October Consumer Sentiment Prices rose in all regions, with the Northeast seeing the largest year-
Index, consumers feel a bit more hopeful about the long-term outlook over-year gain at 6%.
than they did pre-pandemic. However, this optimism has cooled since
its high point in mid-2022. Through 2024, people’s expectations of Mortgage rates were around 6.44% in mid-October, slightly up from the
inflation have been fairly stable, staying within a 2.9% to 3.2% range, previous month but down from last year’s high. Cash sales were popular,
which is a bit higher than the 1.9% to 2.8% range seen before COVID-19. making up 30% of transactions. Meanwhile, distressed property sales
remained low, at only 2% of the market. Although economic factors
Key measures show that, while extreme inflation worries spiked in favor potential buyers, affordability remains a challenge, with homes
2022, they’ve settled down some. The percentage of people expecting staying on the market slightly longer than last year.
very high inflation (above 15%) is currently around 11% — higher
than before the pandemic but lower than the 2022 peak of 14%. Most Jobs

consumers now expect inflation to ease off, though a minority still The September jobs report shows a stable U.S. unemployment rate
worry about persistently high inflation.
at 4.1%, with 6.8 million unemployed people, slightly higher than last
Overall, long-term expectations remain stable, suggesting that while year’s 3.8% and 6.3 million unemployed. The unemployment rate for
people still expect inflation to be a factor, they are less anxious than adult men decreased, while rates for other groups, including adult
last year. women, teenagers, and racial/ethnic categories, showed little change.
Short-term unemployment fell by 322,000 to 2.1 million. Long-term
unemployment remained steady at 1.6 million — up from 1.3 million
last year — comprising 23.7% of all unemployed.

Labor force participation held at 62.7%, and the employment-
population ratio was largely unchanged at 60.2%. The number of
involuntary part-time workers remained high at 4.6 million, up from 4.1
million a year ago. The group of those wanting a job but not in the labor
force stayed steady at 5.7 million, with marginally attached workers up
by 204,000 to 1.6 million, including 445,000 discouraged workers.

Non-farm payroll employment rose by 254,000, exceeding the
12-month average gain of 203,000. Growth was especially strong in
food services and drinking places (+69,000), as well as in health care,
government, social assistance, and construction sectors.

Existing Home Sales U.S. Dollar Advanced Based on Jobs Report

In September, existing home sales dipped 1% from August and were The dollar index rose on Oct. 25, 2024, with the greenback set to lock
down 3.5% compared to last year, hitting an annual rate of 3.84 million. in a fourth straight week of gains after data this week kept interest rate
The median home price rose 3% from the previous year to $404,500, expectations for the Federal Reserve in check while investors looked
marking the 15th straight month of price increases. Inventory slightly toward next week’s key payrolls report.
increased, providing a 4.3-month supply at current sales rates. This is
good news for buyers looking for more options. However, first-time The Commerce Department said non-defense capital goods orders
buyers are struggling, accounting for just 26% of sales, a near-record excluding aircraft, a closely watched market for business spending
low. plans, jumped 0.5% last month after an unrevised 0.3% gain in August
and above the 0.1% rise estimated by economists polled by Reuters.