THE MARKET IS MOVING, EVEN IF THE DATA IS NOT
This week has been a strange one in the financial world. Markets opened strong, mortgage bonds are steady, and yet we are all operating with less information than usual. Because of the extended government shutdown, much of the economic data the markets rely on has been delayed.
Here is the quick version of what happened:
The October jobs report was delayed and will not include an unemployment rate.
The Consumer Price Index for October was canceled.
The November inflation and labor reports will not come out until mid to late December.
All of this is happening after the Federal Reserve meets on December 10. That means the Fed may have to make decisions about interest rates without the usual data they depend on. For this reason, most analysts believe a rate cut next month is unlikely.
To put it simply:
We are experiencing a lot of uncertainty, and the market is reacting to gaps in information.
THE IMPORTANT REPORTS TO WATCH THIS WEEK
Even in a short holiday week, we have a handful of meaningful updates coming:
Producer inflation (PPI)
Retail sales
Consumer confidence
Pending home sales
GDP for Q3
PCE inflation
New home sales
You do not need to be an economist to understand these. Here is the simple breakdown:
If the reports show strong spending and strong growth, rates tend to rise.
If the reports show cooling or slowing, rates tend to ease.
With markets closed Thursday and closing early Friday, trading volume is lower, which can make rate movement more sensitive.
THE HOUSING MARKET IS QUIETER, BUT SURPRISINGLY HEALTHY
Now for the part people are always most curious about.
Despite the noise in the larger economy, the housing market is finishing the year stronger than many expected.
Here is what we are seeing:
Existing home sales have improved year over year for four straight months
Pending home sales are at multiyear highs
Mortgage rates have stayed below 6.75 percent for sixteen weeks
This matters because the Bay Area is a rate sensitive and inventory constrained market. When rates stay under 7 percent, buyers stay engaged.
We track this weekly, and so far in 2025:
42 weeks have shown year over year growth in buyer activity
29 weeks have shown double digit growth
Only 18 weeks were negative
6 were flat
This is not the story you hear on social media. It is a story of steady recovery, not decline.
Inventory is rising slowly, but not enough to shift power dramatically. New listings improved this year but did not surge. Price reductions are up, which is normal during fall and usually reflects overpricing at the start rather than a market downturn.
The simple takeaway:
This market has more strength than the headlines suggest.
If rates stay stable, 2026 could open much stronger than people anticipate.
INVENTORY IS STILL THE MOST IMPORTANT INDICATOR
Here is the easiest way to understand what is happening nationally:
Cities with too many homes for sale are seeing prices fall.
Cities with too few homes for sale are seeing prices rise.
Nick Gerli recently shared data showing this clearly. Markets like Dallas, Austin, and Tampa have an inventory surplus, and their prices are adjusting downward. Markets with an inventory deficit, like the Bay Area, are holding strong.
If you have followed my webinars, you know this has been true for years.
A real housing crash requires a large amount of oversupply. We do not have that here.
A SIMPLE LESSON FROM WARREN BUFFETT
Over the past 30 years, the dollar has lost half its value due to inflation. The S&P 500, even after adjusting for inflation, has grown more than 870 percent.
Buffett has always believed that successful investing is about patience and discipline. Right now, Berkshire Hathaway is holding a record amount of cash because he does not see enough high quality, low risk opportunities. When valuations are high and the environment feels uncertain, waiting can be a strategy.
So what does this mean for regular buyers, homeowners, and investors?
Real estate continues to be one of the few assets that:
Helps hedge against inflation
Builds wealth through equity
Offers leverage
Allows you to control the asset itself
And in markets with limited supply like the Bay Area, well located homes continue to hold value even during uncertainty.
FINAL THOUGHT
Whether you are buying, selling, investing, or simply watching the market, staying informed is more important than trying to time every small movement. I will continue to monitor the data as it comes in and share clear updates as we move into December.