Buyers continue to compete for homes in Los Gatos!!! Inventory is down 25% from the same time period as last year. With the Holidays here the seasonal slowdown in activity is likely to be in effect until the beginning of January, says our San Jose Main office manager. However there are many sellers who have signed listing agreements and are waiting for the first or second week of January to come on the market. He expects to see an increase in inventory in January but with the many buyers in the market the increase in inventory could result in an equal amount of increased sales and therefore inventory levels will remain low. As expected the local Willow Glen Market is in full holiday mode, according to our local manager. Listing inventory continues to decrease with the high 20’s for active listings. Sales activity has come to a crawl. This trend will probably continue as we move into the beginning of the New Year. One thing is certain: the market will be hungry for new inventory as we move into 2016. Are you looking to sell? Let me help you get top dollar for one of your biggest investments.

HOME SALES DECLINE Over the past week, economic events have had very little effect on mortgage rates. Year-end volatility due to light trading volume has been the more significant influence. Mortgage rates ended the past week just slightly higher. The last batch of data released this year on housing activity showed that we are ending 2015 at better levels than in 2014, but below the best levels of this year. A surprising 11% drop in existing home sales in November can be, at least partially, attributed to longer closing times resulting from new closing disclosure regulations. While existing home sales dropped sharply, NAR's Pending Home Sales Index for November was nearly unchanged. This index measures contracts to buy existing homes which were signed during the month. This measure would not have been affected by the new regulations. Fannie Mae projects the improvement in housing activity seen in 2015 will continue in 2016 with a 3.9% increase in total homes sales. The most recent inflation reading, the core PCE price index, showed that in November inflation remained well contained, at an annual rate of just 1.3%. Both low commodity prices and a stronger dollar have helped keep inflation low in 2015. However, the effect these have on inflation is transitory. Unless commodity prices continue to fall or the value of the dollar continues to rise, future readings will not reflect these benefits. The Fed's effectiveness at keeping expectations for future inflation low will influence mortgage rates in 2016.