near record highs, what can you do if you're looking for a home in this difficult market cnbc's diana olick has some answers in our series "priced out." >> reporter: marta moreno is on the hunt for a bigger home. mortgage rates are giving her a big pause. >> i'm guessing you pr >> that's really cool. >> reporter: but today's sky-high mortgage rates are giving her a big pause. i'm guessing you probably have a very low mortgage rate on your current mortgage, yes? >> yes. >> reporter: everybody's got 3%, right? >> yes it makes it really difficult to purchase a home at a much higher interest rate. >> reporter: in just two years, mortgage rates have gone from 3% to 8% that adds nearly $1,000 to the monthly payment on today's median-priced home rates are surging because the federal reserve is still trying to tame going to be over, but we do hear a chorus of fed speakers in a very inflation, and the economy is still hotter than they'd like >> we don't know exactly when it's going to be over, but we do hear a chorus of fed speakers in a very notable way saying that they are restrictive and that the

let's get out to diana olick for the numbers. diana? on this and they seem to be recovering a bit, flat to slightly lower as they're fueled by lower interest rates, but sales of newly built homes dropped a much wider than expected 5.6% in october from september and september's figure was revised down significantly. still, sales were nearly 18% higher year over year. this read is really the most recent indicator of home sales because it's based on account of signed contracts and not closings. so the deals were actually in october and that's when mortgage rates shot over 8% after hanging in the low 7s for most of september. builders have been buying down rates aggressively for their customers and many saying they're getting them into the 5% range, but we also saw aggressive price cuts in october with the median price down 18% year over year. some of that may be the mix of home selling and that is the smaller, lower priced homes and homebuilders are reducing prices to get buyers in. the inventory of newly built homes also shot higher to a

as of october 25th, berkshire owned 25% of occidental. >> i want to toss over to diana olick with thef dr horton. >> they have a big entry level line of express homes. they are the ones to watch to see how badly higher morntgage rates are playing into the market. the company's stock is positive year to date and surged last week when mortgage rates plunged. take a look at rates during the quarter reported. volatile, but generally going up. the 30-year fixed in the 6% range briefly, but well into the 7 range. comments on rates and buydowns and incentives and how that is hitting the bottom line of horton. another metric is cancellation rates as some may not qualify for a mortgage when they first signed the deal. frank. >> we are now joined by jay from kbw to discuss horton. >> thank you, frank. >> what do you expect from the report? >> thank you very much. we rate the shares market performance have a $142 price target. we rate the shares of market perform on valuation and we would be inclined to be positive going to earnings. the key is the low inventory trumps rates in the environment.

cnbc's diana olick has more. diana, i bet people are jumping in. >> well, probably not exactly.ause although, melissa, it was an epic drop, but we gave a little back today. all right. where are we? the 30-year fixed started on monday of last week at 7.92% and took three major plunges starting wednesday and ending friday with the lower than expected jobs report. it totaled more than a half of a perc percentage-point drop in one weekend. that very rarely happens. of course, the builder stocks just love that you can see the home construction etf shot up, but then rates moved 10 basis points higher today, which the itv did not love. to put it in perspective, though, if you're buying a $400,000 home with 20% down on a 30-year fixed mortgage, your monthly payment on friday was $119 lower than it was last monday. five days difference, $119. so what does that mean for the fall housing market? well, it could help on the edges maybe, but we've still got sky-high home prices. the last time affordability was this bad was in the 1980s when rates were in the double-digits, but the average hom

markpy zani is with us diana olick on the housing and jewely boorstin with amazon.n. it's called irrational exuberance. >> that's a great line this is about as exciting as it gets 10-1 advancing declining stocks. what do we have, lower inflation, number one. if the fed's done raising rates and yields are lower, this is going to have a very positive effect on consumer and borrowers. you never see them move 10%. >> that's why the russell is doing what they're doing. >> they're financials. 30% financials in the russell 2000 so the markets are acting like a soft landing is attainable what about earnings? if really this is happening, the consumer is going to act better all of a sudden. borrowing costs are going to go down earnings revisions are going to happen on the upside earnings numbers have been coming down a bit recently that could very well turnaround. that's another factor. a good part of this is obviously short covering institutional traders have been caught offside the pain trade. >> other pain trade is money going into cap one doesn't a new trend make but let'

diana olick joins us in her continuing series on climate startups. what are they up to now?travel trailers can't propel themselves. the drag on regular vehicles means more gas. with more of us using electric vehicles now, the drag on battery power can actually make it prohibitive. what if there were a trailer that could change all that? >> reporter: the $50 billion travel trailer industry is finally hitching up to the ev ecosystem. legacy companies like winnebago and newcomers like light ship and pebble are not only electrifying their systems but changing the vehicle model itself. california-based startup pebble has invented a self-propelled, self-powered remote control trailer. >> we have a generous ev battery on board. we have integrative solar array over the rooftop of our trailer travel so you're harnessing the renewable energy from the sun the entire vehicle. you can flip this office down to turn this into a bed. >> reporter: the 25-foot trailer that sleeps four also has its own electric motor so it propels itself, saving on the power needed from the car dragging it. th

our diana olick. as recession risks also run higher.xt guest sees opportunity for the home builder which historically outperform. >> senior analyst at seaport research partners. you have a buy on the homebuilders as you have for some time, ken. welcome back. >> thank you. we actually just upgraded five of our ten builders on thursday. >> wow. >> yeah. it was a big deal for us. we do move ratings around. our upgrade looks at housing sector returns of the market being positive 75% of the time over the last inversion cycles and that was the ten-year with builders outperforming 29 and 46% versus the market on the 6 and 12-month basis. >> sothat's interesting. we all knowablely when the yield curve is uninverting that is a bad thing. there have been a couple of times when hadn't and we didn't have tightness in the senior loan and we have the tightness now. so it seems like we're going to follow the path where the recession comes next which in that case, i can't imagine, even if you buy the builders on inversion trade, where do you sell them?

diana olick. >>> taking a look at the markets ahelped of the big fed decision, carl, we are going strongk part of the big setup here is we've seen bonds rally with yields moving south and that offers some relief to equities, but potentially to the fed. it comes from weak data, the ism. people are focused on that number, prices paid, and then the treasury refunding announcement, a little less worry there in terms of just how much the treasury will sell and issue debt. >> we're working our way through so many things right now. it's earnings, the data you mentioned. we haven't even gotten to jobs friday where it's going to be a lot about the overall strength of the labor market and wages even with the data this week. >> we expect to step down in terms of the pace of hiring. last month 336,000 jobs were added. as long as pages can continue to moderate at least, that should be good enough for the fed. they do want to get inflation under control which is why i'm eager to hear how powell is describing what's happening with wages now. we heard from the former richmond fed president last hour, an

diana olick is here with more. a, it is a rare position to be the bearer of good news with are rates. >> i get to use the screen with at arrow going down. mortgage rates started dropping at the beginning of last week in anticipation of the rate hikes. 30-year fixed at 7.92%. it started to slide on tuesday and then a 19-basis point drop on wednesday after the fed held the rate where it was and another 18 basis points on thursday. then on friday with 13 more points down after the jobs number was lower than expected. that signalled a cooler economy. add it up and that's 54 basis points or .50% in one week which rarely happens. to put that in perspective, if you are buying a $400,000 home with 20% down on 30-year fixed mortgage, the monthly payment is $119 lower today than it was just last monday. what does that mean for the fall housing market? it is a help on the edges, but not going to get the market moving again with gas. higher rates make buying more expensive, but so do high prices which continue to rise. again, a

diana olick. home sales data. >>> it's one where we have a lot of quotes to talk about from the retailers to figure out what's going on with the consumer because there's a lack of macro economic data, but not a lot of color and commentary here's burlington coat factory i like to pick out comments. they had a good quarter but on the outlook here's what ceo says although we believe over the next five years we can achieve average annual comp sales store growth, we're planning 2024 more cautiously than this a lot of economic, political and geopolitical uncertainties and difficult to predict what this uncertainty might mean for our business similar from lowe's, lowe's, of course, 75% is diy, do it yourself projects, more exposed to the weakness. we've seen a cautious consumer for some time now, this quarter we saw some of the consumers increasingly prioritizing experiences over goods spending, on travel and entertainment. as a result, whenever the diy customer becomes cautious it disproportionately aff

for more in-depth coverage on this number, let's aim east and talk to diana olick. diana?t of details on this report. yes, sales down 5.6% month to month, but what's interesting is this number is based on signed contracts in october. that is people out shopping during the month when mortgage rates went over 8%. we've been talking about the builders buying down these mortgage rates, but clearly they couldn't do it enough during this month. we did see prices come down dramatically. the median price of a home sold in october, a new home, $409,300. that is down nearly 18% year over year, and the supply of new homes for sale jumped from a 6.9-month supply to a 7.8-month supply. builders have supply ready to go but can't sell it. going forward, the question is going to be we've seen mortgage rates pull back from 8% to around 7.32% today, but we're not coming below 7% yet. so, are we going to see any improvement in sales as we go into this very usually dead winter season? this is not a good sign for the builders going forward, who actually had been doing very well. builder etf ha

diana olick has it. es dropd 1.5% in october nth to month a little better than expected but the lowest level since this index started in 2001. ev worse than during the great recession. sales down 8.5% from october of last year. now this index measures signed contracts on existing homes so peop out shopping in october, which was when mortgage rates shot higher, briefly going over 8% on the 30-year fixed. rates have pulled back to 7.3. the realtors continue to say it's tthe just high rates, but still very low supply of homes for sale. pending sales fell except in the northeast, fell most steeply in the west where homes are priciest. sales were down everywhere compared wh a ar ago and just on pric, they'rnot easing up at all e gains have been accelerating due to tig suppland strong dema. sales of homes priced ove $750,000 he been increasing simply because there's more supply othe higher end of the rket. one more note on that worse since the great ression, the difference here is that sales wly built homes are

our diana olick joins us with more. we see it immediately. >>> mortgage demand is crawling out of the basement. total application volume increased 3% from the previous week according to the mortgage bankers association. the highest in six weeks. this is the average on the 30-year fixed, dropped to 7.41%. we're at the lowest level on that since the end of september. applications to refinance a home loan increased. they were 4% lower than the same week a year ago. the vast majority of homeowners with mortgages have rates much lower than they could get now. applications for a mortgage to buy a home increased 4% week to week, still 20% lower than one year ago. the average loan size was $403,600. that's the lowest since january of this year and the mba says that points to a gradually increasing first-time home buyer share. and we did get the october read on existing home sales yesterday that showed first-time home buyers are weak and sales at a 13-year low. while we are seeing mortgage demand rise slightly, carl, it is off e

our diana olick joins us now with more. good morning. >> good morning, frank.he housing market has cooled off dramatically this fall. that's due to the sharp jump in mortgage rates. the average fixed started at 6.5%. now it's hovering over 8%. that's hitting affordability hard. there was an unexpected jump in new home listings which led to slightly higher inventory last month, but homes are still selling very quickly, keeping the overall inventory low. prices were 2.6% higher than august of last year. that's up from the 1% increase in july. it's also 6% higher than when prices bottomed at the start of this year. interesting though, the city's seeing the biggest gains are not the pandemic hot spots. quite the opposite. chicago, new york, and detroit led the pack of gainers. meanwhile formerly strong markets like las vegas, phoenix, and san francisco are higher year over year and the regional differences are much bigger than they have been, and that is that markets have been historically more affordable and are no longer. without a break on interest rates we're g

. >>> housing data crossing the tape to diana olick who has that for us. >> home builders sentiment fellnovember on the monthly index, that is a big miss the street was looking for unchanged. this is the fourth straight month of declines and anything below 50 is considered negative and sentiment is now down 22 points, just since july, to the lowest level since the end of last year. the builders did make a note that nearly all of the monthly data for november was collected before the cpi report showed inflation moderating, so you can factor that in of the index's three components current sales conditions fell six points to 40 sales expectations in the next six months dropped 5 points to 39 and buyer traffic fell 5 points to 41 higher mortgage rates did start to come down this morning but we're at a more than 20-year high last month. more builders did report cutting prices in november 36% of them up from 32% in the previous two months, and that is the highest share of price cuts in this cycle tying the previous high two years ago the price cut was 6% back to you guys. >> diana, obviously,

i want to get straight over to diana olick who joins us with more >> andrew, this optimism that rickut 7.5% on the 30-year fixed. it shot up over 8% and held very high during the month. the expectation might have been that we see starts and permits come down. we really didn't now most of the strength in this number i will say is in multifamily. because that's a total number that rick just gave you. single family starts are basically flat permits up .5% starts up .5%. but the fact that they didn't come down is really important. i think the reason you're seeing that is because the builders are just benefiting so much from the fact that there is no supply on the existing home market and because they have able to buy down those mortgage rates. when you talk to the builders and earnings reports, they're saying they're buying down the rates to about 5.5%. maybe they're not as sensitive to the higher mortgage rates than the existing home side of the market and there is optimism that continues construction, we hear it from the builders, earnings reports continue to show increases in new orde