Edmunds reports that 12.7% of folks who financed new vehicles in June committed to a monthly payment of $1,000 or more. This is the highest level on record and up from 7.3% in June of 2021, 4.6% in June 2019 and 2.1% in June 2010. Additionally 36% of consumers are opting for terms of 73-84 months which is up from 33% in June of 2021. The average car loan break down is: $6.3K down, 5% APR, $40.6K loan, $678 monthly, over 70.3 months. For reference, an auto loan payment of $1,000 a month lowers your purchasing power on a house by roughly $175,000.

Mortgage Rates – rates improved this week as the price of Mortgage Backed Securities (MBS) increased due to inflation reports coming in slightly lower than expectations and negative GDP predictions. Rates are up approximately 2.5% from this time last year.

GDP – the US Bureau of Economic Analysis released their final review of GDP for Q1 =and it showed a contraction of 1.6%. This means the annualized rate of growth during the first quarter of this year was 1.6% lower than 4th quarter of 2021. The Atlanta Fed is now predicting -1% growth in Q2. The textbook definition of recession is two consecutive quarters of negative growth, we won’t know until Late September what the official numbers look like.

Inflation –the Fed’s favorite measure of inflation (Personal Consumption Expenditures) showed that inflation rose 0.6% in May which was lower than the expected 0.7%. The year over year number remained unchanged from April at 6.3%. If you strip out food and energy the year over year number is 4.7% which is down 0.2% from the previous report. Keep an eye on personal spending (increased 0.2% last month – lower than expectations) as that is often an indicator for GDP.

Home Sales – last month we saw an increase in both New Home Sales (up 14%) as well as existing haome sales which increased by 0.7% during May. Sales are down 13.6% year over year for existing homes. This report shows that we are still seeing demand in spite of higher interest rates.

Home Values increased 2.1% during April and are up 20.4% year over year. The year over year numbers is essentially the same as last month – extremely hot.

Rents increased by 1.3% in June and are up 14.1% year over year. in 2022 the median rent has increased 5.4%. The pace of increase is down from last year’s highs but is still up significantly from 20128 and 2019 numbers.

Mortgage Applications to purchase homes were flat week over week and are now down 24% year over year. Refinance applications increased 2% last week and are down 80% year over year. Refinances make up 30% of transactions.

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