Federal Reserve raised its benchmark overnight interest rate

The Federal Reserve is driving the economy into a recession as it tries to fight inflation.

The Federal Reserve raised its benchmark overnight interest rate by three-quarters of a percentage point in an effort to cool the most intense breakout of inflation since the 1980s. And, there are further increases’ in borrowing costs still ahead despite evidence of a slowing economy in an effort.

Inflation has been raging in the U.S. while economic growth measured by GDP is slowing. The U.S. Commerce Department recently reported a second straight quarter of negative economic growth.

Generally, a central bank tightens money by raising interest rates when the economy is healthy or over heated in order to head off inflation. By making money more expensive to borrow, the Fed’s rate moves work relatively quickly to temper demand. As buying a house or a car or expanding a business becomes pricier, people pull back from doing those things. With fewer consumers and companies competing for the available supply of goods and services, price gains are able to moderate.

Larry Summers, the former Treasury Secretary, argued that the Federal Reserve needed to take “strong action” to control inflation and that allowing inflation to gallop out of control would be the “bigger mistake” than causing a recession. Summers blames inflation on the spending boom of 2020/2021 that spurred excess demand.

Summers believes to tame inflation the Fed must crush demand. But, slowing the economy down could trigger a recession, leaving workers unemployed and families with lower incomes.

Fed officials themselves acknowledge that their tools are blunt, that they cannot fix broken supply chains and that it will be difficult to slow the economy enough without causing an economic downturn.


References:

  1. https://www.nytimes.com/2022/07/27/business/economy/interest-rate-inflation-impact.html
  2. https://www.reuters.com/markets/us/fed-unveil-another-big-rate-hike-signs-economic-slowdown-grow-2022-07-27/

Words Create Life Direction

“Train your mind to see the good in every situation.” —Unknown

Words set the direction and destination for your life. You can’t speak defeat and expect victory! That’s why you need to pay attention to what you’re saying.

It is not possible to walk in prosperity and talk poverty. It is not possible to walk in health and talk sickness. It is not possible to be love and forgiveness ruled and at the same time talk bitterness and anger.

Change the words you speak will change the direction of your life.  Words are the rudders that steer your life.

Ship captains know the importance of a strong rudder. Without it, they can never reach their destination. Your tongue is like a rudder on a ship. Whatever controls your tongue, controls your direction and destiny.

Your tongue and your words are the rudder of your life. Joel Osteen

What we say with our words and think in our minds will eventually become what we believe and what fruits our lives will bear. You will eat the fruit of your words. Thus, everything you say should be good and encouraging. Since “your tongue and your words are the rudder of your life.”

“I know for sure that what we dwell on is what we become.” — Oprah Winfrey

This is why it is important that you start saying and focusing on positive things about yourself. You set the direction with your words. Over the long-term, you’re going to become what you’re continuing saying.

Thankfulness is the language of faith! And with faith, you have to speak it before you see it.

“My friends, love is better than anger. Hope is better than fear. Optimism is better than despair. So let us be loving, hopeful and optimistic. And we’ll change the world.” —Jack Layton

Your words set the direction and destination in your life. You will never rise above them, your words. You will become in your tomorrows what you believe and speak in your todays.

You can change the course of your life by changing the words you speak. Start taking notice of the direction your words are steering your life. Words have directions an destinations. Change your words, change your destination.


References:

  1. https://www.yourlifeyourvoice.org/pages/tip-101-positive-things-to-say-to-myself.aspx
  2. https://www.jonasclark.com/changing-the-words-you-speak-change-the-direction-of-your-life/

There are Things More Valuable than Money

Money is not the most important thing in life. But, there are some things in life that are more valuable than money.

There are many aspects of life that are more important and valuable than money. The ancient proverb that “health (and time) is more important than wealth” is absolutely true.

There are things and experiences that are more valuable than financial capital (or money), things that can lead straight to your success and happiness:

Physical Health

Health is something in life that is more valuable than money. The fact is that money can’t improve your health if you eat unhealthy refined sugar and saturated fat laden foods, smoke, get inadequate sleep, and live a sedentary lifestyle.

The money you earn can equip you to sustain your health with a sound healthcare system. But what is the use of all the money if you have no time to take care of your health.

Perhaps money will buy you the best of healthcare intervention. But you have already spent the entire life running after money; it might be just too late to enjoy the wealth you have made.

If you are unhealthy to travel, to see new places, to eat all kinds of food, you can’t enjoy just being with the money you’ve earned. Hence being healthy and taking care of yourself is more important than money.

Thus, it’s more important to get adequate sleep. Sleep is your body’s method of resetting and replenishing itself—including (and especially) the brain. And, get healthy and exercise.

Mental Health

Depression, anxiety, and stress cannot be cured just by having a lot of money around you. Why are even the most successful and wealthiest people committing suicide or even sometimes giving up everything for a simple life. It is because they want mental peace and wellbeing more than anything.

So before its too late, focus on your mental health and wellbeing, as it is more important than having money.

Integrity And Respect

The most important thing that you would want in your life is earning the respect of your family and friends. You must have the integrity to carry on with your work. Being wealthy implies that you are well respected, but the respect displayed for being wealthy is for the money you have and not for the person making it.

Your good deeds and giving back to others will earn you respect. How well behaved and respectful you are, how honestly you carry out your work, that will earn you respect. 

Relationships: Loving Family and True Friends

Many people believe that it is quite lonely at the top. In the rat race to earn the most money and to achieve the highest status, we forget to make room for the ones we love – our family, friends, and people who genuinely care for you.

If you are running behind money, you are going far from your near and dear ones. At your difficult times, it will not be money that would give you relief but the presence of your family and friends near you will. These relationships will take you further than money. Family and friends are the foundation that holds the structure up.  From our mother’s unconditional love to our spouse’s constant emotional support, many of us usually take it for granted.

We need to constantly tell our loved ones how much we appreciate them and let them know that we care about them.  We should also go out of our way to help them, because doing so will allow the family bond to stay strong.

To have real friends who will stand for you, no matter what is actual bliss. On top of that, there a few types of toxic people who can even pull you dow. So money can only buy people who would be fake around you.

Making genuine friends and having them for a lifetime is more important than money.

Happiness and Joy

Some of us feel that money equates to happiness but many Americans take it to the extreme and miss the point.  What ends up happening is that without really thinking about it, many people sacrifice their health and family for potential wealth building opportunities. 

When you work too hard, you are giving up precious family time and also your health as you spend less hours relaxing and resting trying to get ahead.

The real fun is not to own a lot of things that make you happy momentarily but to be content inside out and through experiences.

You can be rooted in visiting your hometown; you do not need a lot of money for that, but merely a will to go back and enjoy. Are all the poor unhappy? Well, not! Some find their happiness in spending time with their loved ones and doing simple things in life. 

In the end, it’s all the small things and experiences in life that make a person feel content and happy within.

Gratitude

Gratitude is a feeling that money cannot buy at any cost. Certain things make a person. They are core values, experiences, your attitude, and above all, the feeling of gratitude for all that you have in life.

If you do not have gratitude, you would not even evolve as a better person. So showing appreciation is much more important than money in your life.

Time

Time is a treasure—the time you set aside not to be wasted, not to be given away. The time you set aside to be invested in something that brings value to your life and to others.

Time is the biggest asset in this world. You can never buy time with money or any other valuable things. 

Those who have time want money, and those who have money want time

You know the funny thing is that most people want what they can’t have and this is usually true across both ends of the time/money spectrum.

Those who are unemployed or have low incomes will strive for more hours or a better paid job while those who are on six figure salaries often moan that they have no time to spend with their friends and family.

Neither of these is desirable and both will ultimately cause unhappiness in your life so the trick is to find a happy medium which leads me to my next point.

A healthier balance leads to a healthier life. You can have all this free time but no actual money to do anything worthwhile or you can have all this money but no free time to do the things you want. The challenge is to find a balance and earn enough money without sacrificing all of your free time.

Greed

Greed can be good and useful when you are greedy for and focused on the right thing.

  • Being greedy to spend time with loved ones:  The greed and strong desire to spend more time with friends and family.
  • The greed for a hobby: Have the desire to do things that you like the most.
  • Being greedy to learn and grow in life and succeed: To be able to learn new skills and upgrade yourself and invest in yourself, rather than your belongings.

Purpose

Having a purpose in your life is the most important thing than anything else. You might have all that you want including, loved ones, money, and fame. But if your life is purposeless, if you don’t hold a cause, eventually you might even question your own existence. So ask what is your ‘why’ and keep reminding it to you. Remember your ‘why’, no matter where you reach or what you achieve in your life. It will always guide you on the right path.

Faith

Faith is an investment that cannot be matched. Money can’t touch it. What if you had a million dollars and no faith? You’d be poor. You wouldn’t be wealthy.

Faith is a mindset and is self-motivation and is understanding imperfection. Faith is free and is what unites people for a better tomorrow.

When life gets tough, it is faith that reassures you that things will get better. When life is going well, it is upholding your faith in positivity that creates happiness.

“Believe in yourself; have faith in your ability.”

Concluding Thoughts

If you put your time and energy into the things and experiences more important than money, the money will follow anyway. All you need is to prioritize and reorganize your time and goals. Rethink what is more important and ask what is your ‘why’.

Money is one side, and all the above are on another. Earning money can help you in a long way, but drawing a line is the solution.

Life is for living and experiencing all things and not just chasing money. Live and love life, be grateful for what you have, and strive to be better every single day, anyway money will follow you.


References:

  1. https://alignthoughts.com/life-is-for-living-and-not-just-earning-money-heres-what-is-more-important-than-money/
  2. https://www.psycholocrazy.com/5-reasons-why-time
  3. https://nsucurrent.nova.edu/2016/02/23/why-having-faith-is-more-important-than-religion/

Inflationary Energy and ESG

The Environmental, Social, and Governance (ESG) movement has shaken up the oil and gas industry over the past 10 to 15 years.

Rising energy prices points ti the reality that the global demand for oil and natural gas exceeds its current supply.

Investments in oil and gas companies and the development of new projects are increasingly under scrutiny due to ESG, which, according to analysts at Deutsche Bank, could increase inflation in the long run. And higher inflation is already one of the biggest worries people have.

ESG stands for environment, social and governance. It is characterized as a responsible or sustainable investment.

According to ESG philosophy, a portfolio manager may not invest in a company if, for example, he or she considers the risk due to climate change to be too severe. Another scenario is that investors may only invest provided the company works to reduce the environmental risks such as climate change.

“If you systematically underinvest in oil and gas production for years, then that necessarily increases your reliance on foreign dictatorships abroad that don’t care about the green energy transition,” says Vivek Ramaswamy. “This is not by accident, this is by design.”


References:

  1. https://nationworldnews.com/what-esg-investment-can-mean-for-oil-prices-and-inflation/

Do-It-Yourself Tests to Monitor Your Health

Five Do-It-Yourself Tests to Monitor Your Health as You Get Older

There are several simple exercises you can do at home, like standing on one leg, measuring the distance you can walk and standing up from sitting, to monitor and assess your health and well-being, according to The Wall Street Journal. 

Here are five exercises you can do at home that doctors and experts on aging recommend for monitoring your health. But, it’s important to emphasize, none of the simple exercises are a substitute for regular medical care and professional health assessments.

One-legged standing test

The average person under the age of 70 should be able to stand on one leg for 10 seconds at a time, says Claudio Gil Soares de Araújo, a sports and exercise physician in Rio de Janeiro.

A recent study published in the British Journal of Sports Medicine, which found that the ability of middle-aged and older adults to stand barefoot on one leg for 10 seconds was associated with higher rates of survival years later. Researchers used an adjusted model that accounted for factors including age, sex, body-mass index and comorbidities. 

Try it at home while brushing your teeth, but make sure you have a nearby wall or person to hold on to if you start to wobble. Keep your arms and elbows extended naturally by your side, and place the front foot of the lifted leg on the back of your opposite calf. If you can’t maintain a static stance for 10 seconds, you should consider consulting a physical therapist or doctor about your fitness level.

Sit-to-stand test

The sit-to-stand test involves sitting in an armless chair and timing how long it takes you to stand up and sit back down.

Sit in a chair with your arms crossed over your chest, then stand up while keeping them crossed, and sit back down five times.

The average person in their 60s should be able to complete this sequence in 11.4 seconds, a person in their 70s should be able to complete it in 12.6 seconds and a person in their 80s should be able to complete it in 14.8 seconds, says Natasha Bhuyan, a Phoenix-based primary-care physician and regional medical director at membership-based primary-care practice One Medical. The times come from an analysis of studies that have looked at the sit-to-stand test, she says.

The sit-to-stand test measures balance, which is an important indicator of long-term health and a predictor of falls, says Dr. Bhuyan. The test also evaluates strength in the lower extremities. If you don’t perform well, talk with your primary-care doctor.

Push-up test

The number of push-ups you can do may provide useful feedback about your musculoskeletal health. A 2019 study published in the Journal of the American Medical Association found that among men with an average age of 40, participants able to complete fewer than 10 push-ups (without long pauses) were at a significantly higher risk of cardiovascular disease than those on the upper end of the spectrum of endurance, who could do more than 40.

For men in their 50s and 60s who can’t do more than 10, he says, the results should be a red flag. “It’s probably confirmation of what you already believed, which is that you might be neglecting strength and resistance training,” says Nathan LeBrasseur, director of the Mayo Clinic’s Robert and Arlene Kogod Center on Aging.

Six-minute walk test

In this test, measure how far you can power walk (not run, not stroll) in six minutes. If you don’t get farther than 350 meters, or about 1,150 feet, that could indicate other health issues, according to physicians.

The exercise helps measure endurance and fitness, which can provide clues to your cardiovascular and lung health. 

There is no perfect age to start this test, says Dr. Bhuyan. Doctors often perform it with patients as people transition to Medicare coverage at age 65, she says, if they have concerns about mobility issues. (In a clinical setting, the test is often performed in a long hallway.) 

You can try doing it yourself earlier. Some people may want to start in their 50s, Dr. Bhuyan notes, especially if they are experiencing shortness of breath while walking.  

Another version of the test is to visit a 400-meter track and time yourself to see how long it takes you to power walk one lap. A time longer than six minutes and 40 seconds would be “of significant concern” for a person in their 50s, says Dr. LeBrasseur.

If the distance is challenging to complete, or if you are seeing a significant increase in the time it takes you to complete the same distance year-over-year, consult your doctor.

Cognitive test

Cognitive health in midlife is an important predictor of health later on, neurologists say. It’s a good idea to get a baseline measurement around age 65 or earlier if you have a family history of cognitive decline or are noticing yourself forgetting something that used to be a no-brainer, such as paying bills.

The Self-Administered Gerocognitive Exam (SAGE) is an at-home, 10 minute to 15 minute screening test that can help detect early signs of cognitive, memory or thinking impairments, says neurologist Douglas Scharre, who developed the exam. It includes memory recall questions and simple math problems.

A digital version of the exam automatically calculates your score at the end. Users must pay for the digital version. For people who prefer the free, printable version, Dr. Scharre recommends taking the results to your primary-care doctor for scoring and interpretation.

If further evaluation is recommended, your doctor might suggest you take a test called the Mini-Cog. The test is administered by a professional, says Sonja Rosen, chief of geriatric medicine at Cedars-Sinai.


  1. Alex Janin, Five Do-It-Yourself Tests to Monitor Your Health as You Get Older, The Wall Street Journal, July 21, 2022. https://www.wsj.com/articles/five-do-it-yourself-tests-to-monitor-your-health-as-you-age-11658364889
  2. https://wexnermedical.osu.edu/brain-spine-neuro/memory-disorders/sage

Consumers Falling Behind on Monthly Payments

AT&T announced that “more of its customers are starting to fall behind on their bills, a sign that rising costs are pinching many households even for services most Americans consider essential,” writes Drew Fitzgerald in The Wall Street Journal.

The company executives reported that subscribers were paying their monthly phone and internet bills on average two days later than a year ago.

Rising interest rates and higher prices on everything from groceries to gasoline this year due to decades high inflation have pressured consumer sentiment. “When you have 9% inflation, it tends to hit those in the low end of the market really, really hard,” said John Stankey, AT&T Chairman and CEO.

Dividend payout ratio matters

The dividend payout ratio is the amount of dividends paid to shareholders in relation to the total amount of free cash flow the company generates. In other words, the dividend payout ratio measures the percentage of free cash flow that is distributed to shareholders in the form of dividends.

AT&T’s current dividend commitment is for around $8 billion annually, or $2 billion a quarter. The company generated $1.4 billion in free cash flow in the second quarter, far short of the $4.7 billion that analysts were expecting. It means that AT&T’s free cash flow for the quarter didn’t cover its dividend commitment in the period.


References:

  1. Drew Fitzgerald, AT&T Says Customers Fall Behind, The Wall Street Journal, July 22, 2022, pp. B1-B2.
  2. https://www.barrons.com/articles/att-stock-dividend-yield-earnings-51658426833

Living with Purpose

To live a life with purpose means to live with intent, direction and destiny.

“Living with purpose” means doing what truly matters to you in strict alignment with your values, beliefs and goals. Anthony L. Burrow, associate professor of Human Development at Cornell University says, “Purpose is a forward-looking directionality, an intention to do something in the world.”

When you’re in alignment with your purpose, life feels right. Things seem easy and right, and everything just seem work. You feel alive, passionate, and lit up from within. You aren’t concerned with how to get where you’re going; you’re sure of yourself, even if you’re uncertain at the same time.

The unknown is scary. We feel safe and comfortable with how things have always been. Uncertainty and fear are part of us and will always be there, but they can’t rule you unless you let them; so take action toward your purpose and goals anyway.

A purposeful and happy life consists of moving towards goals that synchronize with your values

To live with purpose, you must awake every morning with gratitude and focus intently on your overall goals, dreams and desires. It’s the ultimate key to success and personal achievement.

Do you have amazing, audacious goals and dreams for your life?

Finding purpose is about being be authentic. It is about finding what motivates you. And pushing and planning to be successful in that endeavor. And then follow that.

Maybe you live with the sole purpose of finding your one true passion, or to help others to learn and grow, or to seek out new adventures and travel the world. Whatever you’re looking for in life or what you’re passionate about is usually your purpose.

“The person who’s willing to give the most wins. The person who’s the most extreme wins. The person who refuses to lose wins.” Andre Norman

Determine the three to five things you live by now, for example:

  • I am a NYTimes best selling author,
  • I am a civic and community leader
  • I became a billionaire, and
  • I traveled and experienced the world.

Always remember, important keys to success and personal achievement are a definite of purpose and a burning desire.

Additionally, confidence and belief in yourself are key. Consciously decide that you know what’s best for you. Put your hand on your heart and tell yourself, “I trust my ability to make the best decisions for me.” Do this for every area of life that’s important to you.

It means that you become the golden eagle that soars and it means that you’re allowed to fly and spread your wings. Being a golden eagle means soaring and not settling.

Bottomline, “There is nothing that can’t be done if God is with you.”

A purposeful and happy life consist of moving towards goals that align with your values, beliefs and purpose.

“Every person has a longing to be significant; to make a contribution; to be a part of something noble and purposeful.” ~ John Maxwell


References:

  1. https://chopra.com/articles/first-steps-to-creating-a-life-of-purposehttps://chopra.com/articles/first-steps-to-creating-a-life-of-purpose
  2. https://www.entrepreneur.com/article/336600
  3. https://www.lifeadvancer.com/purpose-driven-life/
  4. https://crisp.co/podcast/episode-98-andre-norman/
  5. https://www.desire-and-belief.com/napoleon-hills-“six-ways-to-turn-desires-into-gold”/

Seven Common Characteristics of the Wealthy

Accumulating wealth has little to do with an individual’s level of income.

Most of the truly wealthy in America don’t live in Beverly Hills or on New York City’s Park Avenue, instead, they live next door to you and the typical American.

In the bestselling book, The Millionaire Next Door, the authors, Dr. Thomas Stanley and Dr. William Danko, identified seven common characteristics that show up repeatedly among those who have accumulated wealth over the long-term.

If you want to build wealth and achieve financial freedom, it’s essential to study and embrace these seven common characteristics of the wealthy:

Characteristic #1: They live well below their means.

Frugality is the foundation of wealth building. Habits of frugality that are void of luxury-car purchases may not impress the neighbors, but they’re important traits to embrace to build wealth. The goal is financial independence and financial freedom, not the appearance of wealth.

Characteristic #2: They allocate their time, energy, and money efficiently, in ways conducive to building wealth.

The wealthy know how to budget their money, and they know how to budget their time. They anticipate and plan their incomes and expenses. They spend significant time researching their investments. They spend time examining ways to increase their unrealized income; i.e., tax-advantaged investment accounts.

Characteristic #3: They believe that financial independence is more important than displaying high social status.

It’s easier to appear wealthy than it is to be wealthy.

The wealthy understand that conspicuous consumption and high levels of “domestic overhead” carry a highly negative correlation with one’s true net worth. The wealthy aren’t interested in status vehicles or other showy products. After all, it is much easier to appear wealthy than it is to be wealthy.

Characteristic #4: Their parents did not provide economic outpatient care.

Statistics demonstrate that the more financial assistance an adult child of affluent parents receives, the less likely it is that that adult child will become wealthy.

Generally speaking, the more dollars adult children receive, the fewer they will accumulate.

These gifts — whether for down payments or for a grandchild’s private-school education − will, more often than not, simply generate higher levels of consumption. After all, it’s much easier to spend someone else’s money than your own.

Characteristic #5: Their adult children are economically self-sufficient.

Cash gifts from parents to their adult children result in dual outcomes:   They increase the children’s dependence upon the parents for continuing financial support, and they deplete the parents’ financial position.

The authors of Millionaire Next Door found that cash gifts from affluent parents to their adult children serve dual negative outcomes:

  • They increase the children’s dependence upon the parents for continuing financial support, and
  • They continuously deplete the parents’ financial position.

Characteristic #6: They are proficient in targeting market opportunities.

Finding specific niches and exploiting them is often the key to generating an above-average income. In a nation geared toward turbocharged levels of consumption, market opportunities are created constantly for those willing to supply new products or ideas.

Characteristic #7: They chose the right occupation.

The successful man or woman is a person who likes their work and who can’t wait to get up in the morning to get down to the workplace.

Wealth is generated through talent, desire, and discipline. There are four times as many millionaire entrepreneurs as there are millionaire employees.

There are too many people [employees] today working at jobs that they don’t like.

The successful man or woman is a person who works at a job, who likes their work and who can’t wait to get up in the morning to get down to the workplace. They can’t wait to rise up from bed and get down to their workplace and get the job underway.

Each “characteristic” played an integral part in the means by which these people achieved their enviable financial positions and became The Millionaire Next Door”.


References:

  1. https://themillionairenextdoor.com/publications/the-millionaire-next-door/
  2. https://themillionairenextdoor.com/2011/08/factor-7-a-key-characteristic-of-the-millionaire-next-door/
  3. https://www.mdmproofing.com/iym/7factors.php

Thought of the Day

“You are never too old to set another goal, or to dream a new dream.” ~ C.S. Lewis

The legendary Alexander the Great, king of the ancient Greek kingdom of Macedonia, lived only to the young age of 32, but he built a great empire. During his 13 year reign, he conquered the eastern Mediterranean, Egypt, the Middle East, and parts of Asia in a remarkably short period of time.

You don’t need to match Alexander the Great’s accomplishments, but think intently about what you want out of life. And, once you do, focus on your burning desire in life and chase it with all your energy.

We never know when our journey will come to an end.

U.S. Housing Market

Updated: July 22, 2022

Home sellers are contending with apprehensive buyers amid rising mortgage rates and the possibility of an oncoming recession. RedFin

Single family home sales in June showed the first signs of leveling off after steady monthly increases for more than a year, according to the Jacksonville Daily Record. Although, sellers still were receiving slightly above 100% of asking price in June in certain housing markets, the general trend is mixed nationwide.

Price drops have become a common feature of the cooling housing market, particularly in places that were popular with homebuyers earlier in the pandemic, writes Dana Anderson, a data journalist at Redfin. Nearly two-thirds (61.5%) of homes for sale in Boise, ID, had a price drop in June, the highest share of the 97 metros in RedFin’s analysis. Next came Denver (55.1%) and Salt Lake City (51.6%), each metros where more than half of for-sale homes had a price drop. 

Home prices rise in June

In June 2022, home prices were up 11.2% compared to last year, selling for a median price of $428,379, according to Redfin.

On average, the number of homes sold was down 17.4% year over year and there were 609,147 homes sold in June this year, down 737,598 homes sold in June last year. The national average 30 year fixed rate mortgage rate is at 5.5% and is up 2.5 points year over year.

While also in June 2022, the number of homes for sale was 1,647,846, up 1.6% year over year.

The number of newly listed homes was 782,083 and down 4.4% year over year. The median days on the market was 18 days, up from 3 year over year. The average months of supply is 18 months, up from 3 year over year.

Additionally, 55.5% of homes sold lower list price, down 0.86 points year over year. There were only 17.9% of homes that had price drops, up from 9.0% of homes in June last year. There was a 102.3% sale-to-list price, down 0.24 points year over year.

Moreover, inflation and higher mortgage rates have slowed sales and priced out of the housing market many potential home buyers. As a result, the inventory of homes are beginning to pile up on the market and prices are slowly falling nationwide.

Takeaway…the once red hot U.S. housing market is showing signs of cooling and housing prices are contracting. Instead of over eager buyers and multiple offers on listed homes for sale, buyers are canceling sales contracts in increasing numbers and walking away from earnest money. And, what was unthinkable just a year ago, home sellers and builders are cutting home prices to entice potential home buyers and close sales.

For sellers, there is still money to be made in the housing market, but asking prices need to be very attractive to home buyers.


References:

  1. https://www.redfin.com/us-housing-market
  2. Dana Anderson, More than 60% of Boise Home Sellers Dropped Their Asking Price in June Amid Cooling Market, Redfin.com, July 14, 2022. https://www.redfin.com/news/price-drops-cooling-market-june-2022/
  3. Dan MacDonald, Northeast Florida home prices dip after months of increases, Jacksonville Daily Record, July 22, 2022, pg. 4. https://www.jaxdailyrecord.com/article/northeast-florida-home-prices-dip-after-months-of-increases