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In this Real Estate News Brief for the week ending May 20th, 2023... what the Fed Chief is saying about interest rates and potential rate cuts, how the FHFA is responding to a controversy over new rules for home loan fees, and why mall owners have become interested in pickleball. \xa0 Hi, I'm Kathy Fettke and this is Real Estate News for Investors. If you like our podcast, please subscribe and leave us a review. \xa0 Economic News \xa0 We begin with economic news from this past week, and the Fed chief\u2019s response to predictions about what the central bank plans to do next. Jerome Powell spoke out at a conference at the Federal Reserve Bank of Chicago and said that Fed officials have made \u201cno\u201d decision yet on their next move. Many economists are expecting a pause in rate hikes, but the Fed is determined to bring inflation back down to the 2% level, no matter what. A decision would be made after the Federal Open Market Committee evaluates \u201call\u201d the most recent data. (1) \xa0 Powell may have also dashed a few hopes for rate cuts later this year. He says: \u201cThe data has continued to support the FOMC\u2019s view that bringing inflation down will take \u201csome time\u201d and that rate cuts simply are not part of the Fed\u2019s current forecast. But he also says that interest rates are currently high enough to slow economic growth, and hopefully tamp down inflation without further credit tightening. \xa0 Meantime, the U.S. leading economic index, or LEI, shows a decline in April, for the 13th month in a row. The declines have pointed toward a potential recession, but so far, that hasn\u2019t happened. The index was down .6% last month with eight of the ten economic indicators showing a decline. (2) \xa0 Initial jobless claims were down last week, thanks to an effort in Massachusetts to reduce fraudulent claims. They fell from 264,000 the previous week to 242,000 last week. Overall, they have been slowly rising since January. The number of continuing claims was also down by about 8,000 with about 1.8 million people collecting benefits. (3) \xa0 New home construction was higher in April, thanks to an outsized demand among consumers, despite high interest rates. The government says they rose 2.2% for the month with more activity in the Midwest and the West. That\u2019s for both multi-family construction, which was up 5.2%, and single-family, which was up 1.6%. Building permits were down, however, by 1.5%. (4) \xa0 The home builders confidence index also reflected a positive outlook among builders. The National Association of Home Builders say the index was up five points to a central balance point of 50 in May. Anything above 50 is positive, and below 50, negative. The reading for May is the first time it\u2019s been out of negative territory in almost a year. (5) \xa0 The latest report for existing home sales is for February, and according to the National Association of Realtors, it surged 14.5% as interest rates experienced a temporary dip. It was the biggest monthly increase since July of 2020 when sales skyrocketed 22.4%. NAR says that single-family sales are currently at their highest level since the association started tracking them in 1999. (6) \xa0 Mortgage Rates \xa0 Mortgage rates are still moving sideways. Freddie Mac says the 30-year fixed-rate mortgage was up just 4 basis points, to 6.39%. The 15-year was unchanged at 5.75%. (7) \xa0 In other news making headlines... \xa0 FHFA Rescinds New DTI Fee Structure \xa0 The FHFA is rethinking its controversial new up-front fee structure for single-family home loans which placed more importance on a borrower\u2019s debt-to-income ratio than it did on credit score. The government finance agency has now rescinded the new fee structure for Fannie and Freddie loans, and is asking for input on the goals and policy priorities that the FHFA should pursue in regards to an upgrade of the pricing framework. (8) \xa0 When the FHFA announced the previously upgraded pricing structure, there was an outcry from real estate organizations, including the Mortgage Bankers Association, the National Association of Realtors, and others. It kinda blew up in the media, because it appeared to raise the fees for people with higher credit scores while lowering fees for low income borrowers, and gave the appearance of an unfair fee subsidy.\xa0 \xa0 The FHFA denies that the fee structure was based on the idea of a subsidy. But it is now accepting feedback from the public on how to adjust the fee structure to better reflect loan risk in order to protect Fannie and Freddie against those risks, and without unnecessary expense for borrowers, especially those struggling with affordability issues. \xa0 Mall Owners Filling Empty Stores with Pickleball Courts! \xa0 Mall owners have a new strategy to fill vacant stores and attract more people. They are turning to the fast-growing sport of pickleball, and replacing shuttered stores like Bed, Bath, and Beyond with pickleball courts! (9) \xa0 The combination satisfies a need on both sides as consumers gravitate toward locations that offer fun, social experiences and not just a place to shop. Malls have already been incorporating things like theaters, arcades, and amusement parks into their shopping locations. So now, they are adding pickleball, and other experience-based activities like skydiving and virtual golf. \xa0 Pickleball is currently the nation\u2019s fastest growing sport. As reported by CNN and the Sports & Fitness Industry Association, it\u2019s up 159% over three years to 8.9 million players in 2022. \xa0 That\u2019s it for this episode of the Real Estate News for Investors. Please check the show notes for links at newsforinvestors.com. If you want to learn more about investing in real estate, be sure to hit the \u201cJoin for Free\u201d button, and check out how RealWealth can help you create a cash-flowing real estate portfolio. And don\u2019t forget to subscribe to our podcast! \xa0 Thanks for listening! Kathy Fettke \xa0 Links: \xa0 1 - https://www.marketwatch.com/story/feds-powell-says-progress-on-bringing-down-inflation-will-be-slow-452edc06?mod=mw_latestnews \xa0 2 - https://www.marketwatch.com/story/slowing-u-s-economy-gets-closer-to-recession-leading-index-signals-bac107f3?mod=economic-report \xa0 3 - https://www.marketwatch.com/story/jobless-claims-fall-sharply-to-242-000-as-massachusetts-battles-fraud-dc71930f?mod=economy-politics \xa0 4 - https://www.marketwatch.com/story/u-s-housing-starts-rise-2-2-in-april-3062a768?mod=economy-politics \xa0 5 - https://www.marketwatch.com/story/builder-confidence-rises-for-fifth-consecutive-month-amid-ongoing-shortage-of-u-s-homes-for-sale-a41d33ba?mod=economy-politics \xa0 6 - https://www.marketwatch.com/story/u-s-existing-home-sales-rise-for-the-first-time-in-13-months-surging-14-5-in-february-12603067 \xa0 7 - https://www.freddiemac.com/pmms \xa0 8 - https://www.fhfa.gov//Media/PublicAffairs/Pages/FHFA-Requests-Input-on-the-Enterprises-Single-Family-Pricing-Framework.aspx \xa0 9 - https://amp.cnn.com/cnn/2023/05/13/business/pickleball-malls-retail-bed-bath-beyond/index.html