Gulf Tour – Here are the highlights from the gulf tour in addition to the $400M ‘flying palace‘
– UAE to import 500,000 of Nvidia’s AI Chips. UAE committed to $1.4T investment framework in US sectors
– Sanctions have been lifted on Syria after 42 years, shocking our own sanction officials.
– Iran offered a ‘nuclear deal‘ no decision yet, terms TBD
– Qatar purchases 160 jetliners from Boeing with the option to purchase 50 more. a $96B deal
Mortgage Rates increased slightly this week as the price of Mortgaged Backed Securities slackened. Rates are down 0.25% from this time last year.
Housing Starts – the US Census released their new residential construction report and it showed that permits declined nearly 5%. Time will tell if less of these permits get used due to tariffs. The annualized pace of starts is 1.36M which is well below the annualized household formations at 1.8M. This should support home values if demand continues to outweigh supply.
Inflation – the April Producer Price Index , which measures wholesale inflation, declined 0.5% year over year the index fell 0.3% from last month to 2.4%. The Core rate, which strips out food and energy, declined 0.4% in April and is down from 3.3% to 3.1% year over year. The Consumer Price Index (CPI) report showed that overall inflation rose 0.2% in April and remained at 2.8% year over year.
Rents – Realtor.com’s rent report showed that new rents fell 1.7% year over year in April, marking the 21st consecutive month of year over year declines. Vacancy rates rose 7.1% in Q1, the highest level since 2018. The CPI report is still showing rents rising 4% year over year, so we will likely see that report continue to come down.
Mortgage Applications to purchase homes rose 2% last week and are up 18% year over year. Refinances were flat but are up 44% year over year. Refinances make up about 36% of applications.