“The construction gains are ‘a very positive sign’. The overall flow of the economy is really improving, and I’m encouraged that housing is continuing to kick in.” – John Silvia, Chief economist at Wells Fargo Securities LLC in Charlotte, North Carolina
(Source: Bloomberg Magazine)
Home prices continue to appreciate amid shrinking inventory, record high affordability, expectations on easing credit conditions, low interest rates and lean inventory. Recent Bank of America Merrill Lynch study states that a positive feedback loop is triggering House party with faster appreciation in the near term. Home inventory clearance is back to the pace during housing bubble taking 4.2 months to clear the existing homes inventory and 4.1 months for the new homes inventory.
Kiplinger magazine reported that the housing industry is firmly on the path to recovery. The national average home price is predicted to increase by nearly 5% this year, and by 7% the following year.
HUD and US Census Bureau released interesting conclusions on multi-family rentals based on a recent Rental Financing Survey:
• There are 2.3 million multi-family rental properties in the United States.
• 67% of properties are owned by households or individuals.
• 70% are managed by the owner or an unpaid agent such as a family member.
• 87% of properties had an average of $699 per unit spent on repairs in 2011.
• 69% of owners spend an average of $1,167 per unit on capital repairs.
A bill aiming to streamline the operations of Fannie Mae and Freddie Mac was introduced in the Senate. The proposed measures are expected to reform and improve the housing finance process.
The Wall Street Journal reported that the Employment Trends Index measured by the Conference Board was at 111.14 in February which was the highest level since June 2008.
Housing recovery has given a boost to job growth with construction hiring adding 48,000 builder jobs in February.
Weekly Initial Unemployment Claims fell by 10,000 to 332,000, and the current unemployment rate is at 7.7%.
Mortgage rates rose this week as February retail sales grew and job growth improved.
Freddie Mac’s 30-year fixed-rate mortgage averaged 3.63% for the week ending March 14, 2013, and the 15-year fixed-rate mortgage averaged 2.79%.