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Weekly Economic Update: October 30, 2023

The Dow Jones Industrial Average dropped 1.88%, while the Standard & Poor’s 500 declined 3.29%. But the Nasdaq Composite index gave up 4.48% for the five trading days. The MSCI EAFE index, which tracks developed overseas stock markets, retreated 1.82%.

Stocks continued their slide last week despite mostly better-than-expected earnings results. While earnings surprises were generally positive, investors were troubled by declines in year-over-year net profit margins and tepid earnings guidance. Particularly hard hit were technology companies, following mixed earnings results.

Remarkable  Economic Strength

Economic data released on Thursday showed remarkable economic strength, with above-consensus forecast growth in third-quarter Gross Domestic Product (GDP) and September’s durable goods orders, with only a minor uptick in initial jobless claims. The results fanned worries that the Fed might need to hike rates further or, at least, maintain high rates for longer.

The first read of third-quarter economic growth was a blowout, with GDP increasing at an annualized rate of 4.9%.  This pace was well ahead of the prior quarter’s 2.1% expansion and above consensus forecasts. Powering the third quarter’s economic performance was strong consumer spending and inventory build-up.

More Young Adults are Moving Back Home to Save Money

We've seen the "Boomerang Generation" in more than a few headlines lately. These young adults return, or "boomerang," to their parents' homes as they attempt to navigate the property market.

The key culprit is mortgage rates nearing the 8 percent mark, providing a new hurdle for prospective homeowners. Additionally, escalating rents, substantial inflation, and high property prices make the path toward homeownership more challenging than in previous years.*

And given the above, potential homebuyers know they may need help.

A recent survey shows that over half of potential homebuyers in the coming year have considered seeking their parents' aid and, in some cases, moving back home to save money.

Although welcoming your children back home can be a loving way to help them achieve homeownership, it can also be a financially stressful event unless framed correctly.*

As your financial advisors, our role extends beyond your portfolio to addressing these financial journeys and offering resources to smooth the way for everyone involved. We are here to help structure conversations that may help your hopeful homebuyers explore options conducive to their future and your financial goals.

Let us know if you have any questions or would like to chat more about the resources available to you and your family.

*Realtor.com, October 10, 2023

Selling a Haunted House in Colorado?

In the Colorado real estate market, sellers don’t have to disclose scary histories of homes. In fact, Colorado law bans sellers’ agents from disclosing anything but physical property damage. 

According to TheZebra.com, homes deemed as haunted are stigmatized properties, which sell for 3% less and spend more time on the market than other homes. And even if a seller doesn’t disclose the haunting history in the listing, buyers or their agents can still find out by doing a little digging — so be careful whom you share your ghost stories with. If you do end up living in a haunted house, prepare for a more difficult resell process. According to survey results, two in three potential buyers wouldn’t move forward with a purchase if a seller disclosed that the property was haunted.
 

Capstone built our reputation on friendly service, impeccable honesty, and respect for every client. Our clients’ needs drive our relationship, and the focus is always on you. We strive to be highly responsive to your requests and are skilled at creating solutions customized to your goals, values, and situation.  Reach out anytime with questions. We're happy to help!

Capstone Investment Financial Group, LLC

Colorado Springs/Denver

719-477-9883

info@capstoneinvest.com