Friday, July 8, 2011

Economic Indicators: Weekly Update for July 1, 2011

Courtesy of the National Association of Realtors.  This is our economist report.


Every week the Research staff analyzes key data releases and explain what they mean for you and your business. In this update, we give the highlights of the most important data releases for the week of June 27-July 1, 2011, along with graphs that show the latest movement and overall trends.
At a glance, this table shows the forecast for some of the most pertinent weekly data for REALTORS® to keep in mind. This changes from week to week as new data becomes available. The directional shift notes the trend from last week’s numbers.
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Personal income grew slightly in May to $13.06 trillion on an annualized basis, or to about $54,000 on average for each adult.  Compared to one year ago, the aggregate national income is higher by 4.2 percent.  The gain in rental income was particularly strong.

  • The bulk of income is from wages, which were higher by 2.8 percent.
  • With mortgage availability exceptionally tight, rising savings will help with down payments for future home buyers.
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  • After 8 months of consecutive month-to-month declines, the non-seasonally adjusted Case-Shiller index ticked upward in April.  This is good news for the housing market, but not much of a surprise as prices tend to rise every spring and summer with an increase in demand from colder months.
  • However, of greater importance to the market is the fact that the seasonally adjusted rate of price growth continued to approach a turning point.    This month’s Case-Shiller index incorporated data over the 3 months of February, March and April, so it does not yet reflect the strength in prices that showed up in NAR’s release of May price data earlier this month.  Consequently, the year-over-year price deficit in the Case-Shilller index will likely follow suit, shrinking in the coming months.
  • The Case-Shiller home price index is in line with NAR’s figures, which show a sharp decline in prices relative to last year, but a trend that has moved toward stabilization.
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  • The Purchase index decreased 3.0 percent from the previous week, indicating continued weakness in the housing markets.  The index does not account for cash purchases, which made up 30.2 percent in May of this year.  Morgage application data only measures applications, not approvals, and at times have shown a widely diverging trend compared to actual home sales.
  • Refinancing activity declined 2.6 percent from the prior week.  Mortgage rates on a 30-year fixed mortgage decreased from 4.57 percent to 4.46 percent during the week.
  • The Pending Home Sales Index, a forward-looking indicator, increased 8.2 percent to 88.8, based on contracts signed in May, from 82.1 in April. The index is 13.4 percent above 78.3 recorded in May 2010. The data reflects contracts and not closings, which normally occur with a lag time of one or two months.
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donna@donnaantonucci.com


www.hobokenrealestatemonitor.com


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