Overview: Over the past week, news about the British exit from the European Union (Brexit) caused some volatility, but had little net effect. The economic data also had a minor impact, and mortgage rates ended the week nearly unchanged.
After a lack of success for over three years, lawmakers are still racing to agree to a Brexit plan before the scheduled separation date of October 31. The latest proposal was rejected by the British Parliament this week, and there is not enough time to put together a new one before the end of the month. Since neither EU nor UK officials want the uncertainty created by a departure with no deal in place, many analysts expect that another extension to the deadline will be seen.
The latest data from the housing sector contained mixed news. In September, sales of existing homes fell a little more than expected from August, but still were 4% higher than a year ago. The national median existing-home price was up 6% from a year ago. A lack of homes for sale in many regions again held back sales activity. Inventory levels nationally were at a 4.1-month supply and were 3% lower than a year ago.
Regarding future supply, overall housing starts in September fell 9% from August. However, the surprisingly strong reading seen last month was the highest since June 2007, so a significant decline this month had been anticipated. In addition, the weakness was entirely due to volatile multi-family units, while single-family starts increased from August.