U.S. housing market data has been sending mixed messages over the past year. On the negative side, existing home sales had been growing steadily since the start of 2015, but slumped sharply in August. Data from the Flow of Funds (FOF) shows outstanding mortgage debt has yet to rise in any meaningful way and, worse, median prices as reported by the National Association of Realtors appear to have fallen slightly in the last four months.

Single-family building permits have been rising slowly but remain far below normal levels, even as home ownership rates—as measured by the U.S. Census—unexpectedly fell at the start of the year. Concerns surrounding Federal Reserve policy and its impact on interest rates is also worrying investors.

Continue reading →