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Obsidian Planning

Obsidian Market Update 12/9/2022

Hi friends!


This week, we’re taking a look at what the housing recession means for investors. Then, we’ll look at a new way to improve your sleep each night.


The housing market has been seriously impacted by rising interest rates. The Housing Market Index, which gauges the outlook for home sales, declined to 33 out of 100 in November–it’s lowest level in a decade. Economists consider anything under 50 to be bad news.


Rising interest rates have made buying houses difficult, as people could be paying $1000 more per month on their mortgages, so that even downsizing a home could be a very expensive prospect. Federal Reserve Chair Jerome Powell has indicated an easing up on interest rate hikes, however, which is one reason mortgage rates are slowly decreasing.


The other reason for the drop in rates is that a recession appears to be on the horizon. The National Association of Home Builders indicates that the housing market has been in a recession since midsummer. Some good news is that mortgage delinquency rates are at historic lows, which should (we hope) mean that people don’t lose their homes to foreclosure at anywhere near the rates they did in 2008.


Unfortunately, first-time home buyers face a tough moment as they can’t tap into equity to finance a large down payment and rising rent prices means it’s harder to save. Rising rent prices also contribute to inflation as landlords take the opportunity in a tight market to increase prices and the housing crisis continues.


None of this is great for investors either, as people are neither buying, selling, nor building homes much at the moment, so there isn’t a lot of activity in that area. The S&P real estate sector has fallen at 25% this year (where the rest of the market has fallen at 16% on average). The good news, however, is that a repeat of 2008 looks unlikely because we don’t face the same issues with financing that we did then. As always, we work to keep your portfolio diversified no matter what is happening so that one sector doesn’t have an outsized effect on your investments.


We sure hope you’re not losing sleep over the housing market, but if you are, it might be time to look into sleep benefits. Companies like SleepScore are revolutionizing the way we think about sleep improvement. If you’ve found yourself wondering why you are not sleeping as well as you should be, SleepScore can analyze your sleep patterns and offer actionable suggestions to improve the quality of your night’s rest. Don’t worry- it’s completely safe and you don’t have to wear anything.


That’s it for us this week! Sweet dreams, and we’ll be back in your inboxes next Friday.


How We Help


Having regular reviews with our clients is an important part of how we do things around here at Obsidian.  We value seeing our clients on a regular basis because things in people’s lives constantly change and those changes usually have some sort of effect on their financial plan. To be able to address changes and concerns with a dynamic market keeps us engaged. We put a plan in place, update it, monitor it, and make sure it is always current. This is what being a fiduciary is about: putting the clients first. We care for our clients and if there is a corresponding effect to their financial plan, our team of professionals helps guide them. We like to learn about our clients so we can know how to guide them in the best ways possible for their future financial well being. Obsidian takes a holistic approach with all of our clients. Ready to set up your next review? Give us a call!


Advisory Services offered through Obsidian Personal Planning Solutions, LLC. Securities are offered through Triad Advisors, member ​FINRA/SIPC.​ Obsidian Personal Planning Solutions, LLC, and Obsidian Personal Planning Solutions, Inc, are not affiliated with Triad Advisors.

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