Bellevue Real Estate, Mortgage, and Economy 9/7/11
Posted on 07 September 2011
Here is the Bellevue Real Estate Report for September 6, 2011:
QUOTE OF THE WEEK…”Believing in progress does not mean believing that any progress has yet been made.”–Franz Kafka
INFO THAT HITS US WHERE WE LIVE…Major progress has yet to be made in the housing recovery, but we can keep believing in it, since the data isn’t all negative. For example, Pending Homes Sales (contracts on existing homes) were down 1.3% in July, but were UP 2.4% in June, so Existing Home Sales should be up for August. In addition, July’s reading was UP 14.4% over last year. The National Association of Realtors chief economist said, “rising rents, record high affordability conditions and investors buying real estate as a future inflation hedge” bode well for real estate.
The latest Case-Shiller National Home Price Index reported home prices UP 3.6% in the second quarter compared to the first, though still down 5.9% from a year ago. This puts home prices at the level they were in early 2003. The 20-city composite index was UP 1.1% for June, but down 4.5% versus last year. Best of all, none of the 20 cities posted monthly declines in June and 19 out of 20 showed increases. Also, data aggregator and analytics firm CoreLogic reported home prices up in July for the fourth month in a row.
NO JOBS…No new jobs were added to payrolls in August, according to the national Employment Report released Friday. That was all investors needed to hear to start a stock selling spree, as the Dow lost 253 points for the day and ended down a fraction for the week. Jobs are important to the health of the housing market, but real estate is local. So earlier in the week it was encouraging to see the Bureau of Labor Statistics report that unemployment rates in July fell, compared to a year ago, in 69% of the 372 metro areas they track.
A mix of good and bad news continued. The Consumer Confidence Index for August hit its lowest level since April 2009. But the August ISM Manufacturing Index came in better than expected, a tick above 50, still indicating expansion. Final Q2 Productivity was down a trifle, but Personal Income was up for July. And Core PCE inflation (excluding food and energy) was well within the Fed’s target range, up only 1.6% since last year.
For the week, the Dow ended down 0.4%, at 11240; the S&P 500 was down 0.2%, to 1174; and the Nasdaq was flat, at 2480.
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