There is cautious optimism in the market this week towards housing market recovery, with positive numbers trickling in for a few key economic indicators. The mortgage rates continue to fall with the 30 year fixed rate at 3.49%, and the 15-year rate at 2.74%. Mortgage refinance applications have peaked to a 3-year high comprising 81% of all the total applications. The adjustable mortgage rate activity, the favorite choice before the housing industry has hit the bottom with 4% of the total.
According to data released by NAHB, Single-family housing starts rose for a fourth consecutive month to a seasonally adjusted annual rate of 539,000 units in June, their fastest pace since April of 2010. Single family housing completions are at 470,000 registering a modest 1.3% increase above the May figure. Unemployment initial claims fell by 35,000 from the previous week’s figure, but most economists feel that it is too early to react to the number, which has shown both upward and downward trends before. Purchasing Managers Index for July fell to 52.18 from 52.5 in June signifying a slower expansion in manufacturing. However, the contraction is more because of decreased exports rather than domestic orders.
Nationwide property indicators: 2nd Quarter 201
The US Census Bureau reported an interesting set of numbers.
Potential inventory pipeline of properties
The foreclosure pre-sale inventory rate stands at 4.09% with 2.1 million loans in this category.
The Federal Reserve Bank of Philadelphia has released the coincident indexes for the 50 states for June 2012. In the past month, the indexes increased in 30 states, decreased in nine states, and remained stable in 11 states, for a one-month diffusion index of 42. So, what is coincident index? As described on the Federal Reserve bank’s website, the coincident combines 4 state level indicators – nonfarm payroll employment, average hours worked in manufacturing, the unemployment rate, and wage and salary disbursements deflated by the US consumer price index (city average). The long-term growth in the state’s index matches long-term growth in its GDP.
Fannie Mae released 2012 Economic and Housing forecast predicting 2% GDP growth rate. The chief economist of Fannie Mae says the housing industry remains the bright spot in the otherwise lackluster growth. While the numbers might not be as high as one would like them to be, the overall reports point to a modest upward trend.
According to NAR, lenders are holding back REO properties in markets with inventory shortages. This has contributed to 1.4% decline in pending home sales in June 2012.
Trulia reported that the top 5 international house hunters were from Canada, United Kingdom, Germany, Australia and India.
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