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A2 | Tuesday, February 6, 2024
Home Buyers Are Finding a Wider Inventory
BY NICOLE FRIEDMAN
Falling mortgage rates
boosted home-shopping activ-
ity in January, luring the first
wave of opportunistic buyers
back to the market after last
year’s collapse in home sales.
A number of home seekers
who paused when borrowing
rates marched higher last year
have resumed their search,
real-estate agents say. Real-es-
tate showings in the week
ended Jan. 31 were up 9.9%
from the first week of the
year, according to Showing-
Time, a unit of Zillow Group.
Buyers are seizing on the
recent reversal in mortgage
rates, which hit a 23-year high
of 7.79% in October. The aver-
age rate on a 30-year fixed
mortgage has fluctuated be-
tween 6.6% and 6.7% this year
and was at 6.63% last week,
according to Freddie Mac.
That recent drop looks
poised to bolster sales activity
in 2024. Mortgage purchase
applications rose in the week
ended Jan. 19 to the highest
seasonally adjusted level since
April, before falling the fol-
Team Cow
Takes on
Team Oat
Continued from Page One
them to milk shaming.” Cue
the staged footage of kids and
adults ostracized over dairy
drinks.
One man recounts a disas-
trous first date. He orders a
glass of milk, only to have his
date throw it in his face be-
fore storming off. A snippet
from what looks like footage
from a restaurant security
camera replays the humiliat-
ing shower.
The YouTube video drew
some 6,000 callers to a vic-
tims’ hotline, 1-888-OK2MILK,
said Yin Woon Rani, chief ex-
ecutive of MilkPep. A thou-
sand people left voice mails,
she said.
Plant-based milk compa-
nies aren’t milksops in this
contest. Sales of plant-based
milk, measured by dollars,
have grown 48% since 2018
MILKPEP
but edged down in the past
year. Califia Farms recruited
Cookie Monster, the blue-
furred “Sesame Street” Mup-
pet, to try almond milk in his
cereal for an ad. No surprise,
the celebrity milk dunker
liked it, calling himself “a
multifaceted individual.”
Dairy milk had $15.8 billion
in sales last year compared
with just under $2.5 billion
for plant-based milk, accord-
ing to Circana, a market-re-
search firm. The two rivals
also face a tsunami of bottled-
, canned- and boxed-water
competitors—all vying to fill a
limited niche. “Your stomach
can only take so much liquid,”
said John Crawford, a dairy
industry analyst at Circana.
Stocks Fall
On Signal
From Powell
Continued from Page One
to CME Group.
The benchmark 10-year
Treasury yield climbed for a
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lowing week, according to the
Mortgage Bankers Associa-
tion.
The gains to affordability
are notable. Since mortgage
rates peaked last fall, a home
buyer with a $3,000 monthly
budget has gained nearly
$40,000 in purchasing power,
according to real-estate bro-
kerage Redfin.
Home seekers had also
hoped more inventory would
become available after the hol-
idays. There are signs that is
starting to happen. Active list-
ings in January were up from
a year earlier while the typical
time on market was down, ac-
cording to Realtor.com.
January thaw
Sarah and William Re-
ithmeyer are part of this
year’s wave of new buyers.
They started looking for their
first house in September but
decided to pause their search.
When they resumed in Janu-
ary, “there were tons of new
listings coming up,” Sarah Re-
ithmeyer said.
After touring 11 homes in
An image from a dairy industry video featuring Queen Latifah. She offers support to victims of ‘milk shaming’ in the spoof.
Milk producers and their
allies are lobbying to scrub
“milk” off the labels of plant-
based rivals. Their position
is: If it doesn’t come from a
lactating animal, it isn’t
milk.
“An almond doesn’t lac-
tate,” former FDA Commis-
sioner Scott Gottlieb fa-
mously noted.
The Food and Drug Admin-
istration last year proposed
that plant-based beverages
could still be called milk but
should carry labels that ex-
plain the nutritional differ-
ences with cow’s milk. The
second day, closing at 4.163%.
The yield is up almost one-
third of a percentage point
since Thursday, its largest
two-day gain since June 2022.
Higher bond yields are an-
other sign that investors now
think the Fed will take longer
to cut rates.
Falling inflation, the pros-
pect of rate cuts, and a huge
rally in technology shares
have helped major stock in-
dexes set records in 2024.
U.S. NEWS
one day, the couple had an of-
fer accepted on a three-bed-
room home in Chesterfield,
Va. The house had been on the
market since October, and the
seller had lowered the price
multiple times.
“We just felt like it was
perfect,” she said.
Last year was the worst
year for existing-home sales
since 1995. Elevated mortgage
rates, home prices around re-
cord highs and low supply
thwarted potential buyers.
Home-buying affordability in
October fell to the lowest level
since 1985, according to the
National Association of Real-
tors.
Home purchases won’t re-
turn to normal levels, market
participants say, unless mort-
gage rates fall further. A rate
below 6% is a key level to at-
tract more buyers, said Rick
Palacios Jr., director of re-
search at John Burns Re-
search & Consulting.
Despite the recent increase
in activity, “we’re still very far
off from a healthy housing
market where lots of sales are
happening,” said Daryl Fair-
idea churned
outrage among
both dairy and Team Cow’s
nondairy com- view: If it
batants.
Blue Dia- doesn’t come
mond Growers,
a cooperative
from a mammal,
of almond it isn’t milk.
growers, said
in comments to
the FDA that
customers aren’t confused
about the difference between
almond and dairy milk. The
Almond Alliance, a trade
group, told the FDA that his-
torians have traced almond
But some investors caution
that tech shares are priced for
perfection and that the lagged
effect of interest rate in-
creases mean there are still
risks in the economy.
“We’re focused on the fact
that despite all the soft land-
ing talk, we might have yet to
feel all of the profound im-
pacts of historical rate hikes,”
said Adam Hetts, global head
of multi-asset at Janus Hen-
derson Investors.
CORRECTIONS 
AMPLIFICATIONS
Belinda Román at the begin-
ning of last year forecast an un-
employment rate of 3.4% for
December 2023. A U.S. News ar-
ticle on Monday about Román,
The Wall Street Journal’s most
accurate economist for 2023,
incorrectly said the forecast
was for December 2022.
Short-interest ratios for the
period ended Jan. 12 were 4.2
for NYSE and 2.4 for Nasdaq.
The Ticker table, which ran in
Monday’s Business & Finance
section, incorrectly gave the fig-
ures as 4.0 and 2.6, respectively.
Readers can alert The Wall Street
Journal to any errors in news articles
by emailing wsjcontact@wsj.com or
by calling 888-410-2667.
Average 30-year fixed-rate
mortgage
8.0%
t1.16 pct. pts.*
7.5
7.0
6.5
6.0
March June Sept.
*From recent peak in October
Source: Freddie Mac via St. Louis Fed
weather, chief economist at
Redfin.
Inventory of homes re-
mains low by historical stan-
dards and is keeping a lid on
sales activity. Many home-
owners either bought homes
or refinanced their mortgages
when mortgage rates fell to
new lows in recent years, and
now they are reluctant to give
up those low rates by selling
milk to medi-
eval times, dis-
pelling any no-
tion it
originated in
an artisanal
coffee joint.
Dairy de-
fenders hope to
herd federal
lawmakers into
prohibiting any
food made of nuts, seeds,
plants or algae from using
such dairy terms as milk or
cheese. Republican Rep. Mike
Simpson of Idaho, a big dairy
state, is a sponsor of the bill.
Survey data released on
Monday showed that the U.S.
services sector expanded
faster than expected in Janu-
ary, the latest in a string of
strong economic data releases
that have some investors
questioning whether inflation
will keep cooling. Goldman
Sachs economists are more
optimistic.
“Could the recent outsize
strength of the U.S. economy
derail continued progress on
disinflation? We don’t think
so,” Goldman Sachs chief
economist Jan Hatzius wrote
in a note to clients Monday.
“With global growth on firm
footing and rate cuts ahead,
our market views remain con-
structive.”
For the year, the S&P 500
is still up 3.6%.
While stock indexes stalled
Monday, AI mania was in full
swing.
Shares of chip manufac-
turer Nvidia jumped more
than 4.8% to a fresh record af-
ter Goldman Sachs analysts
published a bullish growth
forecast for the company, not-
ing that cloud service provid-
ers are spending more on ar-
tificial-intelligence hardware.
Nvidia’s market capitalization
is now above $1.6 trillion.
In earnings, Estée Lauder
shares soared 12% Monday af-
ter the cosmetics maker re-
ported falling profits but said
* **** THE WALL STREET JOURNAL.
their homes and buying differ-
ent ones.
Feb. 1 Although active listings in
6.63% January rose 7.9% from the
same month a year earlier,
they were still nearly 40% be-
low typical prepandemic lev-
els, according to Realtor.com.
(News Corp, parent of The
Wall Street Journal, operates
Realtor.com.)
“It’s definitely more com-
petitive than it was last year,”
said Mike Ferrante, a real-es-
tate agent in Solon, Ohio. “You
have buyers re-entering the
market and not so many sell-
ers.”
Dec. For-sale inventory typically
increases in the spring, which
could give buyers more op-
tions. Homeowners who
wanted to sell last year but
decided to wait for mortgage
rates to fall might not be will-
ing to wait any longer, Fair-
weather said.
Builders benefit
Home builders, meanwhile,
continue to benefit from the
shortage of existing homes on
the market. Newly built homes
He has occasionally posted
sticky notes that say “This is
not milk” on supermarket re-
frigerator doors that open to
plant-based milks, he said.
“I’m not trying to restrict
what you can drink. Just la-
bel it what it is,” Simpson
said. “I got no problem with
almond ‘drink.’ ”
The bill’s sponsors include
Democratic Sen. Peter Welch
of Vermont, a smaller dairy
state. “I wouldn’t go near
them,” he said of plant-based
beverages.
Wisconsin Gov. Tony Evers
wrote to the FDA, lodging a
Index performance on Monday
0.2%
0
–0.2
–0.4
–0.6
–0.8
–1.0
–1.2
10 a.m. 11 noon
Source: FactSet
it would lay off up to 5% of its
workers.
ON Semiconductor was also
among the S&P 500’s best
performers, jumping 9.5% af-
ter it reported revenue and
profit that exceeded Wall
Street expectations.
Caterpillar shares added
2% to close at a record high
after the construction equip-
ment maker reported a
fourth-quarter profit that
topped expectations.
Meanwhile, McDonald’s
said war in the Middle East
weighed on its sales in the
fourth quarter. The fast food
made up about one-third of
single-family homes for sale
in December, up from a histor-
ical norm of 10% to 20%.
Many builders are paying
to lower buyers’ mortgage
rates using discount points,
which can make newly built
homes far more affordable
than existing ones. About 62%
of builders offered sales in-
centives in January, including
rate buydowns, according to
the National Association of
Home Builders.
Builders are also pivoting
to smaller floor plans to try to
keep prices down for buyers.
While existing-home sales
slumped last year, sales of
newly built homes rose 4.2%
to 668,000, according to the
Census Bureau.
Home builder PulteGroup’s
sales picked up in December
as mortgage rates declined.
“The strength has really
continued into January,” said
Chief Executive Ryan Marshall
on a Jan. 30 earnings call.
“We continue to be in a situa-
tion where there’s low supply.
Affordability has definitely
gotten better.”
strong objection to labeling
plant-based products “as nu-
tritious dairy products when
they are fundamentally differ-
ent than the true dairy prod-
ucts that Wisconsin farmers
produce.”
Jeff Karbash, owner of the
Duck Inn in Delavan, Wis.,
said he hoped to stay off the
governor’s radar. Karbash
substituted oat milk for dairy
milk in the restaurant’s food
and grasshopper cocktails
while filming an ad for Oatly,
the Swedish oat milk com-
pany.
“The governor may close
me down after doing this,”
Karbash says in the ad. No
rumblings yet from Evers, the
restaurateur said in an inter-
view.
Oatly squeezed into pea-
nuts-and-Crackerjacks terri-
tory last year, serving its fro-
zen dessert bars at more than
50 minor-league baseball
parks.
Company promotions in-
cluded a free Oatly dessert
bar to a whole row of fans
when a foul ball was caught
in an area near first base des-
ignated as the “oat field,”
said Adam Marco, spokesman
and radio broadcaster for the
Scranton Wilkes-Barre Rail-
Riders in Moosic, Pa.
Not enough balls were
caught there so the promo-
tion was expanded to any foul
ball hit to the oat field, Marco
said.
Some companies have a
hoof in both camps. Dairy gi-
ant Danone North America
launched a weeklong “Feel
Planty Good Challenge,” invit-
ing people to try Silk plant-
based milks in their morning
smoothies.
“We see the real estate in
consumers’ refrigerators as
both dairy and plant based,”
said Domenic Borrelli, the
company’s president of plant-
based food and drink.
Nasdaq Composite
S&P 500
Dow Jones Industrial Average
Five-minute intervals
1 p.m. 2 3 4
chain’s shares were 3.7%
lower.
After the closing bell, Pal-
antir Technologies reported
accelerating revenue growth
and record profit, sending its
shares up 17%.
Other companies scheduled
to report earnings this week
include the Walt Disney Co.
and PepsiCo.
Overseas, the Stoxx Europe
600 was little changed. Chi-
nese stocks sold off on Mon-
day but were gaining at mid-
day Tuesday. Japan’s Nikkei
was down 0.7% at midday
Tuesday.