Pending Home Sales fell 2.6 percent in October, a disappointing read and a miss. The National Association of Realtors is attributing this decline to the rise in mortgage rates, which really began in October, reducing the pool of eligible homebuyers. Last week we saw a dip in mortgage rates and compared to 18 years ago, rates are still favorable. Back in October 2000, mortgage rates averaged almost 8 percent for a 30-year fixed. What does all this mean? Short-term, experts are having difficulty finding consensus on the housing outlook. Mortgage rates are expected to rise modestly but they don’t know what that translates to for borrowers and homebuyers as it seems many hesitate. Long-term, there’s confidence homebuyers will accept the new norm for mortgage interest rates and continue to buy based on lifestyle and need. The benefit to sales cooling: the inventory of homes for sale is recovering.

Is 2019 the year for balance? That’s what Zillow is predicting as home values begin to slow down and are expected to continue the trend through next year, with mortgage rates expected to keep rising. 2019 should bring a more balanced market among buyers, sellers, and renters. Housing competition will remain strong in the most desirable areas.

The Federal Reserve Minutes from their meeting earlier this month were released yesterday afternoon, showing most Fed members still believe we need 3 more rate hikes, with a December quarter-point rate hike still on deck and expectations for the next one to not be until at least March 2019. While rate hikes are a sign of a healthy economy there is also risk of hiking too early, making December’s possibility of one still debatable.

Earlier this week, we mentioned home renovations are becoming more popular. Here’s some top common-sense tips we have found since:

• “My dad told me, ‘You can do anything yourself, except foundation, electrical, or plumbing.'” —Kirsten Selvage, homeowner in Ontario, Canada.
• “It’s cheaper to do it right than it is to do it over.” —Jim Molinelli, architect in Columbia, MD.
• Renovate with the next buyer in mind but do so long before you sell in order to enjoy the improvements yourself.
• Over schedule to not feel stressed by lack of time in case any mishaps come up.

Initial Jobless Claims for last week were reported at 234K. While compared to recent months and weeks this is higher than normal, it remains far below that 300K mark highlighting a good, healthy labor market. The ADP and BLS Job Reports are both scheduled for release next week and expectations are 190K and 170K job creations, respectively.