With trade and tariffs constantly in the news lately, we thought it would be a great idea to focus on what to do with all of those extra shipping containers…..the answer? Turn them in to housing.
Shipping containers didn’t exist in 1950. Today, roughly seventeen million travel the world on ships, trains, and trucks. Laid end to end, they’d stretch around the globe almost four-and-a-half times. These 40-foot shipping containers can be purchased with prices ranging from $1,500 to $3,500.
While re-purposing these containers has been commonplace in smaller “tiny home” communities, it appears that living in containers has just entered the main stream with multifamily units.
Recently, there was a new listing offering “units” for rent in a brand new container apartment building in Washington, D.C. where each unit costs about $1,099 per month, and in light of DC’s unaffordable rents, this seems like a good deal for heavily indebted millennial’s.
Some pre-fab container homes are more luxurious than others, ranging from $30,000 to $449,000 for a massive luxury duplex. The image below is of a Redondo Beach House showing how container homes can look modern and inviting:
What Happened to Rates Last Week?
|Mortgage backed securities (FNMA 4.50 MBS) lost -37 basis points (BPS) from last Friday’s close which caused fixed mortgage rates to move higher for the week. It was the third straight week of higher rates with MBS selling off a total of -76 basis points over the past three weeks.
Overview: Across the board, we had strong economic data in just about every sector. We saw inflation in the CPI release, a strong job market in the JOLTS report, a record reading in Small Business Optimism and a very strong Consumer Sentiment reading. Even Retail Sales were solid when prior revisions were taken into account. The bond market also shifted to put more probability of a Fed rate hike in September AND December despite the overhang of tariffs. This combination of growth and inflation pressured long bonds and moved mortgage rates to the highest levels since May.
Retail Sales: At first glance, the August data may look weaker than expected, but not really. The headline reading hit 0.1% vs est of 0.4%. So, it looks light. However, that is only due to the fact that July was much more robust than originally reported and revised upward to a gain of 0.7%. Ex-Autos…same story as the reading was 0.3% vs est of 0.5% but July was revised upward to 0.9%. Gas station sales, restaurants and ecommerce all had solid gains.
Small Business Optimism: The August NFIB Index jumped to 108.8 vs est of 108.1. This is now a new all-time record since this index was created 45 years ago. The survey saw gains in plans to increase inventories, to make more capital outlays and to increase employment.
Jobs, Jobs, Jobs: The Job Openings and Labor Turnover Survey (JOLTS) report hit another new all-time record high with a reading of 6.939M Jobs that are unfilled. It is the seventh straight reading above 6M.
What to Watch Out For This Week:
It is virtually impossible for you to keep track of what is going on with the economy and other events that can impact the housing and mortgage markets. Just leave it to me, I monitor the live trading of Mortgage Backed Securities which are the only thing government and conventional mortgage rates are based upon.