Transcript:[Speaker] Kathy Fettke: In this Real Estate News Brief for the week ending July 10th, 2021... what lenders are saying about a mortgage slowdown, why ARMs are suddenly attractive, and which cities are attracting people who are relocating.Hi, I'm Kathy Fettke and this is the Real Estate News for Investors.Economic NewsWe begin with economic news from this past week. The latest unemployment report shows a slight rise in new claims, but the total number of claims continues to fall. As of June 19th, the number of people collecting benefits was 14.2 million. Economists expect that number to fall faster in September when extra unemployment benefits expire and people are forced to go back to work. (1) And there should be plenty of jobs available. The Labor Department’s latest report on job openings shows a record 9.2 million. That’s exactly double the number of job openings from a low point during the pandemic, and the third month in a row that openings have set a record. (2)In addition to people sitting on the sidelines, many workers are quitting as they seek better jobs. The data shows that 4 million people quit two months ago. Most of them want better paychecks. Many may also want new work scenarios that reflect some of the changes we’ve seen during the pandemic, such as the ability to work remotely.Mortgage RatesMortgage rates have moved lower again this last week. Freddie Mac says the average 30-year fixed-rate mortgage was down 8 basis points to 2.9%. The 15-year dropped 6 points to 2.2%. The dips follow a drop in the U.S. Treasury yields. (3)In other news making headlines...Mortgage Applications Are DownLenders are seeing fewer home loan applications despite that drop in mortgage rates. The Mortgage Bankers Association says that applications for new loans were down 1% for the week, and 14% from last year. Refinance loans dropped 2% for the week, and are 8% lower than last year. (4)The MBA’s Joel Kan says: “Swift home price growth across much of the country, driven by insufficient housing supply, is weighing on the purchase market and is pushing average loan amounts higher.”Adjustable Rate LoansThe adjustable-rate mortgage appears to be making a comeback, as a way for some borrowers to keep loan payments low. So-called ARMs became very unpopular during the housing crisis when home values tanked and loans readjusted to higher interest rates. The current surge in home prices has triggered new interest in getting a loan that starts off with lower payments. (5)According to the Mortgage Bankers Association, applications for ARMs have gone up 12.5% year-over-year. The initial savings is currently about a half percent.Realtor.com reports that the average rate for a 5-year hybrid adjustable-rate mortgage was 2.54% on July 1st, and 2.98% for a 30-year fixed-rate mortgage. Those loans typically readjust to a new interest rate after 5 or 10 years.Lumber Price Drop Lags for BuildersLumber prices have now dropped about 50% from a peak in early May, but those lower prices have not yet reached builders. (6) The National Association of Builders say there can be a “long lag time” for price reductions to work their way through the supply chain.NAHB Economist David Logan says: “As the price declines began grabbing headlines, the price of lumber packages quoted to builders held at record highs.” He attributes this lag to dealers who have inventory purchased for higher prices.The lumber supply chain has several stages. It begins with the cutting of timber that is then sent to a sawmill. From there it goes to a wholesaler who distributes it to a retailer. The builder finally gets the product as an end user.Prices for new-build homes have continued to rise. The NAHB says the median price was $374,400 in May. That’s an 18% increase from May of last year.Construction Worker ShortageHome prices are also being driven higher by the construction worker shortage. The Associated Builders and Contractors group says the industry has only recovered a