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Market Update
Last Thursday, July Pending Home Sales came in UP 5.2%. This measure of signed contracts on existing homes indicates we should see an increase in Existing Home Sales for August and September. Some analysts feel it shows the start of positive market movement after the end of the tax credit, which pushed signed contracts forward into April. We now have a new batch of buyers looking to take advantage of today's affordable prices and historically low mortgage rates.
Speaking of prices, Standard & Poor's/Case-Shiller National Home Price Index reported home prices UP 1.0% from May to June in 20 major U.S. cities. This was the index's third straight gain, which many experts feel came from the increased demand due to the tax credits. So sellers still need to be flexible, since not as many eager buyers are now in the market. But prices do seem to be stabilizing, so buyers would do well to act on a property they like, rather than hold out for any significant price declines going forward.
National average mortgage rates have recently been at historic lows. But in their latest forecast, Mortgage Bankers Association economists see rates going up slightly in the last three months of the year, rising a bit above that for 2011, then perhaps up another percentage point by the end of 2012. More reason for buyers and refinancers to not drag their feet!
Review of Last Week
POSITIVE WITH NEGATIVES... The U.S. economy keeps delivering mixed signals, but this week investors on Wall Street let a positive vibe drive the proceedings. Stocks went up four days in a row, ending with a big rally Friday driven by an August Employment report that was by no means great, but better than the downbeat readings that were expected. All three major stock indexes ended up for the week with the Dow now up for the year.
There were notable negatives that continue to show the pace of recovery has slowed. The ISM Services Index came in below estimates indicating modest growth in the non-manufacturing sector. Consumer inflation was UP 0.2% in July and UP 1.5% over a year ago. This is still within the Fed's acceptable range, although some economists think inflation should start rising noticeably next year. Personal income was up 0.2% for July, but this was below what the consensus expected. Finally, final Q2 Productivity dropped to a 1.8% annual rate, a bigger dip than previously estimated.
Positive signs included the ISM Manufacturing index, reported up for July instead of down as expected. August Consumer Confidence also beat expectations. But the big news came with Friday's Employment Report. The U.S. economy lost 54,000 nonfarm jobs in August, far less than the 100,000+ job losses expected. The private sector added 67,000 jobs, while upward revisions to the two prior months took the net gain to 133,000 jobs. Average hourly earnings were UP 0.3% for the month and UP 1.9% this year. But unemployment ticked up to 9.6%, due to an increase in the work force. So even though the report played well on Wall Street, it didn't on Main Street.
For the week, the Dow ended UP 2.9%, to 10447.93; the S&P 500 was UP 3.7%, to 1104.51; and the Nasdaq was UP 3.7%, to 2233.75.
Bond prices held up for most of the week, but Friday's jobs report surprise kept things in check. The FNMA 30-year 4.0% bond we watch ended UP 7 basis points for the week, closing at $102.27. Again, Freddie Mac's weekly survey showed national average fixed rates for conforming mortgages at historic low levels.
This Week’s Forecast
TAKING A BREAK...This week truly is a break from the hectic pace of economic reports we've seen lately. The Fed's Beige Book on Wednesday will give us another take on the central bank's view of the economic recovery, as reported from Federal Reserve Districts across the country. Observers look to this survey for signs of where Fed policy decisions may be heading in the future. We will continue to watch Thursday's Initial and Continuing Jobless Claims, as experts are predicting a slow improvement there. Thursday's July Trade Balance is expected to be down slightly from the prior month, perhaps signaling more demand for our goods overseas.
The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months Economists believe the Fed will keep rates low well into next year unless we get a boost in inflation or the recovery. Virtually no one expects either of those things just yet. Note: In the lower chart, a 1% probability of change is a 99% certainty the rate will stay the same.
All "Betts" on Brian! The Only Realtor you want!
Thursday, September 9, 2010
Last Week in the News
Last Week in the News
The Standard & Poor's/Case-Shiller 20-city housing price index — on a seasonally adjusted basis — rose 0.3% in June after a 0.5% increase in May. Home prices are 6% above the April 2009 bottom, but 28% below their peak in July 2006.
The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 27 increased 2.7%. Refinancing applications rose 2.8%. Purchase volume rose 1.8%. Refinancing made up 82.9% of total applications, the highest level since January 2009.
The Institute for Supply Management reported that the monthly composite index of manufacturing activity was 56.3 in August after reaching 55.5 in July. Economists had anticipated a reading of 53.2. A reading above 50 signals expansion. It was the 13th straight month of expansion.
Total construction spending fell 1% to $805.2 billion in July, following a downwardly revised $813.1 billion in June. Economists had anticipated a drop of 0.6% in July.
The National Association of Realtors reported that its pending home sales index, a forward-looking indicator based on signed contracts, rose 5.2% in July after a revised 2.8% decrease in June.
The Institute for Supply Management reported that the monthly composite index of non-manufacturing activity fell to 51.5 in August from 54.3 in July. A reading above 50 signals expansion.
Initial claims for unemployment benefits fell by 6,000 to 472,000 for the week ending August 28. Continuing claims for the week ending August 21 fell by 23,000 to 4.4 million. The unemployment rate rose to 9.6% in August from 9.5% in July.
Upcoming on the economic calendar are reports on consumer credit on September 8, international trade on September 9 and wholesale trade on September 10.
All "Betts" on Brian! The Only Realtor you want!
The Standard & Poor's/Case-Shiller 20-city housing price index — on a seasonally adjusted basis — rose 0.3% in June after a 0.5% increase in May. Home prices are 6% above the April 2009 bottom, but 28% below their peak in July 2006.
The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 27 increased 2.7%. Refinancing applications rose 2.8%. Purchase volume rose 1.8%. Refinancing made up 82.9% of total applications, the highest level since January 2009.
The Institute for Supply Management reported that the monthly composite index of manufacturing activity was 56.3 in August after reaching 55.5 in July. Economists had anticipated a reading of 53.2. A reading above 50 signals expansion. It was the 13th straight month of expansion.
Total construction spending fell 1% to $805.2 billion in July, following a downwardly revised $813.1 billion in June. Economists had anticipated a drop of 0.6% in July.
The National Association of Realtors reported that its pending home sales index, a forward-looking indicator based on signed contracts, rose 5.2% in July after a revised 2.8% decrease in June.
The Institute for Supply Management reported that the monthly composite index of non-manufacturing activity fell to 51.5 in August from 54.3 in July. A reading above 50 signals expansion.
Initial claims for unemployment benefits fell by 6,000 to 472,000 for the week ending August 28. Continuing claims for the week ending August 21 fell by 23,000 to 4.4 million. The unemployment rate rose to 9.6% in August from 9.5% in July.
Upcoming on the economic calendar are reports on consumer credit on September 8, international trade on September 9 and wholesale trade on September 10.
All "Betts" on Brian! The Only Realtor you want!
Daily Quotes!
Daily Quotes Sept. 9 2010!
"We may encounter many defeats, but we must not be defeated."
-- Maya Angelou, poet
"You do not succeed because you do not know what you want or you don't
want it intensely enough."
-- Frank Crane, Minister
"Self-esteem is like a difficult-to-cultivate flower. It requires
frequent nurturing that occurs when you keep your word and follow
through on your promises."
-- Derrick Bell
"There's no such thing as not enough time if you're doing what you want
to do."
-- Robert Half
"All life is a chance. So take it! The person who goes furthest is the
one who is willing to do and dare."
-- Dale Carnegie, motivational expert
All "Betts" on Brian! The Only Realtor you want!
"We may encounter many defeats, but we must not be defeated."
-- Maya Angelou, poet
"You do not succeed because you do not know what you want or you don't
want it intensely enough."
-- Frank Crane, Minister
"Self-esteem is like a difficult-to-cultivate flower. It requires
frequent nurturing that occurs when you keep your word and follow
through on your promises."
-- Derrick Bell
"There's no such thing as not enough time if you're doing what you want
to do."
-- Robert Half
"All life is a chance. So take it! The person who goes furthest is the
one who is willing to do and dare."
-- Dale Carnegie, motivational expert
All "Betts" on Brian! The Only Realtor you want!
Wednesday, September 8, 2010
Daily Quotes!
Daily Quotes Sept. 8 2010!
"There is no such thing as a minor lapse of integrity."
-- Tom Peters, Author
"The chains of habit are too weak to be felt until they are too strong
to be broken."
-- Samuel Johnson, Lexicographer
"Character is the ability to carry out a good resolution long after the
excitement of the moment has passed."
-- Cavett Robert
"Deliberation is the work of many men. Action, of one alone."
-- Charles de Gaulle, statesman
"If you want to get the best out of a person you must look for the best
that is in him."
-- Bernard Haldane
All "Betts" on Brian! The Only Realtor you want!
"There is no such thing as a minor lapse of integrity."
-- Tom Peters, Author
"The chains of habit are too weak to be felt until they are too strong
to be broken."
-- Samuel Johnson, Lexicographer
"Character is the ability to carry out a good resolution long after the
excitement of the moment has passed."
-- Cavett Robert
"Deliberation is the work of many men. Action, of one alone."
-- Charles de Gaulle, statesman
"If you want to get the best out of a person you must look for the best
that is in him."
-- Bernard Haldane
All "Betts" on Brian! The Only Realtor you want!
Tuesday, September 7, 2010
Daily Quotes!
Daily Quotes Sept. 7 2010!
"I love the man who can smile in trouble, gather strength from distress
and grow brave by reflection."
-- Thomas Paine, Statesman
"A strong imagination begetteth opportunity."
-- Michel de Montaigne, writer
"It's not what you do once in a while; it's what you do day in and day
out that makes the difference."
-- Jenny Craig, diet guru
"It is dangerous to go into eternity with possibilities that oneself has
prevented from becoming realities. A possibility is a hint from God. One
must follow it. "
-- Soren Kierkegaard, Philosopher
"No great performance ever came from holding back."
-- Don Greene, performance coach
All "Betts" on Brian! The Only Realtor you want!
"I love the man who can smile in trouble, gather strength from distress
and grow brave by reflection."
-- Thomas Paine, Statesman
"A strong imagination begetteth opportunity."
-- Michel de Montaigne, writer
"It's not what you do once in a while; it's what you do day in and day
out that makes the difference."
-- Jenny Craig, diet guru
"It is dangerous to go into eternity with possibilities that oneself has
prevented from becoming realities. A possibility is a hint from God. One
must follow it. "
-- Soren Kierkegaard, Philosopher
"No great performance ever came from holding back."
-- Don Greene, performance coach
All "Betts" on Brian! The Only Realtor you want!
Friday, September 3, 2010
Did you know Labor Day?!
Did you know:
Seventy-six percent of workers drive alone to work. Another 11% carpool, and 5% take public transportation. Average time it takes for people in the nation to commute to work: 25.5 minutes.
More women (26.4 million) work in managerial and professional-related occupations than men (24.7 million).
Of the total American workforce, 10.1 million workers are self-employed and 5.9 million work from home.
There are 16.1 million labor union members nationwideAbout 12% of wage and salary workers belong to unions, with Alaska, Hawaii and New York having among the highest rates of any state. North Carolina has one of the lowest rates at 3%.
All "Betts" on Brian! The Only Realtor you want!
Seventy-six percent of workers drive alone to work. Another 11% carpool, and 5% take public transportation. Average time it takes for people in the nation to commute to work: 25.5 minutes.
More women (26.4 million) work in managerial and professional-related occupations than men (24.7 million).
Of the total American workforce, 10.1 million workers are self-employed and 5.9 million work from home.
There are 16.1 million labor union members nationwideAbout 12% of wage and salary workers belong to unions, with Alaska, Hawaii and New York having among the highest rates of any state. North Carolina has one of the lowest rates at 3%.
All "Betts" on Brian! The Only Realtor you want!
For the week of August 30, 2010
For the week of August 30, 2010
INFO THAT HITS US WHERE WE LIVE
You can't sugar-coat last week's housing reports, but they don't necessarily foretell a "double-dip" recession in real estate. July Existing Homes Sales were off 27.2%, at an annual rate of 3.83 million, well below the expected 4.65 million rate. The months' supply went from 8.9 to 12.5 and there was also a rise in inventories. The truth is, the expectation was a bit high. An annual rate below 4 million for July makes sense, given that the home buyer tax credit was slated to end in June.Getting an $8,000 check from the government certainly encouraged lots of people to move up their purchases. For the same reason, experts also predict weak August numbers, but after that, some feel existing home sales will start heading back to about 5.5 million units annually. For the year, inventories are down 2.0%, while the median price is UP 0.7%.
July New Home Sales were down 12.4% to a 276,000 annual rate, below the expected 330,000 pace. The months' supply went to 9.1, but inventories were unchanged at 210,000, their lowest level in decades. Part of the sales drop was because the now expired tax credit required a signed contract by April 30. New homes sales are counted at contract and the April number hit 414,000. In the three months since then, sales are averaging only 291,000 annually. New home buyers may also be going for recently built homes, now at attractive prices. New homes, typically about 15% of sales, are now around 7%!
The Mortgage Bankers Association's weekly survey showed purchase loan applications UP 1% from the week before, refinance applications UP 6%, and mortgage rates at record low levels.
Review of Last Week
THANK YOU, BEN... Ben, of course, is Chairman Bernanke, head of the Federal Reserve. Friday he said the Fed has no triggers set for further easing of monetary policy and he sees continued economic growth. These comments at a central bank summit in Jackson Hole, Wyoming, were all the Wall Street bulls needed to hear to push stocks up Friday after a week of declines. The big rally wasn't quite big enough, though, as the three major indexes still ended down for the week just a tad.
There were other decent economic signs. The August Richmond Fed index of manufacturing in the mid-Atlantic region was +11, down from July's +16, but higher than expected and showing that the factory sector still continues its strong growth. Durable Goods orders were UP 0.3% for July, but disappointed because 3.0% was forecast. Nonetheless, Durable Goods are UP 9.3% over a year ago. Initial unemployment claims dropped by 31,000 to 473,000 for the week, a nice sign after last week's surge. Continuing claims also fell, by 62,000 to 4.46 million.
Friday featured two big news items. First, Q2 GDP was revised lower, from 2.4% to 1.6% growth, but this was measurably better than what many economists had expected and significant parts of the report showed improvement. Personal spending and business Investment were both revised UP, with domestic purchases UP 4.3%. Corporate profits continued their strong growth in Q2, UP at a 20% annual rate and UP 39% over a year ago. Then we had Chairman Bernanke reassuring investors he expects growth to pick up in 2011 and the Fed is ready to use "unconventional measures if it proves necessary." Again, thank you, Ben!
For the week, the Dow ended down 0.6%, to 10150.65; the S&P 500 was down 0.7%, to 1064.59; and the Nasdaq was down 1.2%, to 2153.63.
Bonds had a bit of a rocky week, ending with investors heading back into stocks on Friday, willing to take on more risk after listening to Bernanke. The FNMA 30-year 4.0% bond we watch still ended UP 5 basis points for the week, closing at $102.20. Freddie Mac's survey showed national average fixed rates for conforming mortgages at historically low levels for yet another week.
This Week’s Forecast
INCOME, JOBS, INFLATION, JOBS, MANUFACTURING, JOBS, HOME SALES, JOBS...There will be important economic reports to ponder, but rest assured, everyone will have Friday's August Jobs Report on their minds the whole week. Experts project a smaller loss of payrolls than the prior month, with the jobless rate about the same. Leading up to the biggie, Monday features July Personal Income, forecast up, and July PCE readings, which should show inflation remaining pretty much in check. Tuesday's Consumer Confidence is projected up a little, but manufacturing is predicted down a tad, as measured by Tuesday's Chicago PMI and Wednesday's ISM Index. Tuesday afternoon we'll have the minutes from the Fed's August 10 meeting and see if they add any insight to Bernanke's comments last Friday.
The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months With concerns about the economic recovery continuing, virtually all the experts believe the Fed will keep rates low for an "extended period," well into next year. Note: In the lower chart, a 1% probability of change is a 99% certainty the rate will stay the same.
All "Betts" on Brian! The Only Realtor you want!
INFO THAT HITS US WHERE WE LIVE
You can't sugar-coat last week's housing reports, but they don't necessarily foretell a "double-dip" recession in real estate. July Existing Homes Sales were off 27.2%, at an annual rate of 3.83 million, well below the expected 4.65 million rate. The months' supply went from 8.9 to 12.5 and there was also a rise in inventories. The truth is, the expectation was a bit high. An annual rate below 4 million for July makes sense, given that the home buyer tax credit was slated to end in June.Getting an $8,000 check from the government certainly encouraged lots of people to move up their purchases. For the same reason, experts also predict weak August numbers, but after that, some feel existing home sales will start heading back to about 5.5 million units annually. For the year, inventories are down 2.0%, while the median price is UP 0.7%.
July New Home Sales were down 12.4% to a 276,000 annual rate, below the expected 330,000 pace. The months' supply went to 9.1, but inventories were unchanged at 210,000, their lowest level in decades. Part of the sales drop was because the now expired tax credit required a signed contract by April 30. New homes sales are counted at contract and the April number hit 414,000. In the three months since then, sales are averaging only 291,000 annually. New home buyers may also be going for recently built homes, now at attractive prices. New homes, typically about 15% of sales, are now around 7%!
The Mortgage Bankers Association's weekly survey showed purchase loan applications UP 1% from the week before, refinance applications UP 6%, and mortgage rates at record low levels.
Review of Last Week
THANK YOU, BEN... Ben, of course, is Chairman Bernanke, head of the Federal Reserve. Friday he said the Fed has no triggers set for further easing of monetary policy and he sees continued economic growth. These comments at a central bank summit in Jackson Hole, Wyoming, were all the Wall Street bulls needed to hear to push stocks up Friday after a week of declines. The big rally wasn't quite big enough, though, as the three major indexes still ended down for the week just a tad.
There were other decent economic signs. The August Richmond Fed index of manufacturing in the mid-Atlantic region was +11, down from July's +16, but higher than expected and showing that the factory sector still continues its strong growth. Durable Goods orders were UP 0.3% for July, but disappointed because 3.0% was forecast. Nonetheless, Durable Goods are UP 9.3% over a year ago. Initial unemployment claims dropped by 31,000 to 473,000 for the week, a nice sign after last week's surge. Continuing claims also fell, by 62,000 to 4.46 million.
Friday featured two big news items. First, Q2 GDP was revised lower, from 2.4% to 1.6% growth, but this was measurably better than what many economists had expected and significant parts of the report showed improvement. Personal spending and business Investment were both revised UP, with domestic purchases UP 4.3%. Corporate profits continued their strong growth in Q2, UP at a 20% annual rate and UP 39% over a year ago. Then we had Chairman Bernanke reassuring investors he expects growth to pick up in 2011 and the Fed is ready to use "unconventional measures if it proves necessary." Again, thank you, Ben!
For the week, the Dow ended down 0.6%, to 10150.65; the S&P 500 was down 0.7%, to 1064.59; and the Nasdaq was down 1.2%, to 2153.63.
Bonds had a bit of a rocky week, ending with investors heading back into stocks on Friday, willing to take on more risk after listening to Bernanke. The FNMA 30-year 4.0% bond we watch still ended UP 5 basis points for the week, closing at $102.20. Freddie Mac's survey showed national average fixed rates for conforming mortgages at historically low levels for yet another week.
This Week’s Forecast
INCOME, JOBS, INFLATION, JOBS, MANUFACTURING, JOBS, HOME SALES, JOBS...There will be important economic reports to ponder, but rest assured, everyone will have Friday's August Jobs Report on their minds the whole week. Experts project a smaller loss of payrolls than the prior month, with the jobless rate about the same. Leading up to the biggie, Monday features July Personal Income, forecast up, and July PCE readings, which should show inflation remaining pretty much in check. Tuesday's Consumer Confidence is projected up a little, but manufacturing is predicted down a tad, as measured by Tuesday's Chicago PMI and Wednesday's ISM Index. Tuesday afternoon we'll have the minutes from the Fed's August 10 meeting and see if they add any insight to Bernanke's comments last Friday.
The Week’s Economic Indicator Calendar
Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates.
Federal Reserve Watch
Forecasting Federal Reserve policy changes in coming months With concerns about the economic recovery continuing, virtually all the experts believe the Fed will keep rates low for an "extended period," well into next year. Note: In the lower chart, a 1% probability of change is a 99% certainty the rate will stay the same.
All "Betts" on Brian! The Only Realtor you want!
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