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INFO THAT HITS US WHERE WE LIVE...Like life, the situation in the housing market depends on what we make of it. Last week, both options were covered in the latest quarterly report from the National Association of Realtors (NAR). The good option: home sales in Q3 rose in all 50 states and Washington, D.C. The negative: the median existing single-family home price rose in only 39 of 150 metro areas, declining in 111 of them. Yet the NAR chief economist pointed out that the sales data was encouraging, because "Home sales need to recover first--only then can prices stabilize."
More good news: inventory levels have been trending gradually down. Good reason for that was offered by NAR President Ron Phipps: "Housing affordability conditions have been at a record high this year, rents are rising and homes are selling for less than the cost of construction in most of the country. For people with secure jobs, good credit and long-term plans, today's conditions will be remembered as a golden opportunity to enter the housing market." Another survey told us a mere 5% boost in prices would motivate 11.7% of owners to sell their home.
Economic data over here was sparse but not terrible. Initial jobless claims came in 10,000 less than the week before, at 390,000. Continuing unemployment claims dropped 92,000 to 3.62 million. The trade deficit shrank in September, which hadn't been expected. And even same-store chain store sales keep gaining, up around 3% from a year ago according to two different surveys.
For the week, the Dow ended UP 1.4%, to 12154; the S&P 500 was UP 0.8%, to 1264; but the Nasdaq slipped 0.3%, to 2677.
The European debt situation also had the bond market experiencing swings in both directions. But when all was said and done, mortgage bond prices suffered a little, as stocks surged on Friday. The FNMA 3.5% bond we watch ended the week down .86, to $101.19. National average mortgage rates were little changed, according to Freddie Mac's weekly survey, staying at their recent extremely low levels.
DID YOU KNOW?... Building Permits reports the number of residential building permits issues the prior month. Investors use it to gauge consumer confidence in the economy. Any weakness suggests consumer spending contraction.
Tuesday's October Retail Sales are predicted up a tad, although at a lower rate than last month. Manufacturing should also be gaining, as measured by New York and Philly indexes, as well as Industrial Production and factory capacity.
More good news: inventory levels have been trending gradually down. Good reason for that was offered by NAR President Ron Phipps: "Housing affordability conditions have been at a record high this year, rents are rising and homes are selling for less than the cost of construction in most of the country. For people with secure jobs, good credit and long-term plans, today's conditions will be remembered as a golden opportunity to enter the housing market." Another survey told us a mere 5% boost in prices would motivate 11.7% of owners to sell their home.
>> Review of Last Week
ARRIVEDERCI, PRIME MINISTERS...Wall Street investors maintained their focus on Europe, but last week the developments were much more positive. Greek Prime Minister George Papandreou stepped down after upsetting everyone by proposing a popular vote on his country's bailout package. Italy's Prime Minister Silvio Berlusconi followed suit on Saturday. Earlier in the week, investor fears of political turmoil were allayed by a successful auction of Italian bonds. Stocks went in both directions, but by the end of hostilities on Friday, the Dow and S&P 500 were up for the week, with the Nasdaq off just a smidge.Economic data over here was sparse but not terrible. Initial jobless claims came in 10,000 less than the week before, at 390,000. Continuing unemployment claims dropped 92,000 to 3.62 million. The trade deficit shrank in September, which hadn't been expected. And even same-store chain store sales keep gaining, up around 3% from a year ago according to two different surveys.
For the week, the Dow ended UP 1.4%, to 12154; the S&P 500 was UP 0.8%, to 1264; but the Nasdaq slipped 0.3%, to 2677.
The European debt situation also had the bond market experiencing swings in both directions. But when all was said and done, mortgage bond prices suffered a little, as stocks surged on Friday. The FNMA 3.5% bond we watch ended the week down .86, to $101.19. National average mortgage rates were little changed, according to Freddie Mac's weekly survey, staying at their recent extremely low levels.
DID YOU KNOW?... Building Permits reports the number of residential building permits issues the prior month. Investors use it to gauge consumer confidence in the economy. Any weakness suggests consumer spending contraction.
>> This Week’s Forecast
HOME BUILDING, INFLATION, RETAIL, MANUFACTURING... There's lots to ponder this week and high on the list will be Thursday's Housing Starts, expected to be down a bit for October, and Building Permits, expected to be up. We'll also get the Fed's favorite reading on inflation, the Core Consumer Price Index (Core CPI), which excludes volatile food and energy prices, and is forecast to remain under control.Tuesday's October Retail Sales are predicted up a tad, although at a lower rate than last month. Manufacturing should also be gaining, as measured by New York and Philly indexes, as well as Industrial Production and factory capacity.
