This Week in Real Estate: April 6, 2015


Good Morning!

This Week in Real Estate ended with a weaker than expected March employment report. The result? The lowest mortgage rates in two months. Below are a few of the highlights from the first few days of April that influence our business:

* New Indicator Says Housing Is Healthy, Downturn Unlikely. Nationwide said on Tuesday that the overall housing market is healthier than at any time since 2001, the earliest point for which data is available and that data suggests there is little reason to fear a national housing downturn over the next year. The insurance and financial services organization unveiled a new housing market indicator, the Leading Index of Health Housing Markets (LIHHM). Nationwide calls the LIHHM “a data-driven view of the near-term performance of housing markets based upon current health indicators for the national housing market and 373 metropolitan statistical areas.” The company says the index focuses on the entire housing market rather than merely projecting house prices or home sales. The indicator is calculated using local level data in four categories, employment, demographics, mortgage market, and house prices. Full story…​

* House Prices Record Annual Gains, Expected To Rise In The Future. The recent release by the Federal Housing Finance Agency (FHFA) shows that its measure of house prices, House Price Index – Purchase only, rose by 5.1% on a 12-month seasonally adjusted basis in January 2015. This marks the 36th consecutive month of year-over-year growth. Over this nearly three-year period, house prices have risen by 20.1%. Similarly, the recent release from Standard and Poor’s (S&P) and Case-Shiller indicates that their measure of national house prices, the House Price Index – National, rose by 4.5% on a year-over-year seasonally adjusted basis. This is the 33rd consecutive month of year-over-year increases in the house price index. Over this period of more than two-and-a-half years, house prices have risen by 22.1%. Full story…

* The March Jobs Report. The U.S. economy added 126,000 jobs in March, ending a streak of 12 straight months of job growth exceeding 200,000, a level of job creation that hasn’t been seen since a 13-month run back in 1994-1995. The unemployment rate in March remained unchanged at 5.5%, while a broader gauge of underemployment that includes workers who have part-time jobs but would like full-time work ticked down to 10.9%, the lowest level since August 2008. The positive news reported last month notwithstanding (CPI), this labor report will give the Fed pause as it considers the timing of interest rate increases (FOMC). The weakness of this report raises the probability that the much anticipated Fed action increasing interest rates will be delayed. Full story… ​

* Mortgage Rates Officially Hit 2-month Lows After Jobs Data. Mortgage rates scored a major victory on Friday at the expense of the labor market. Recent examples of the Employment Situation Report have been surprisingly strong. That presented major problems for rates in February and March as it ramped up expectations for a Fed rate hike. But those expectations have come crashing down in the past few hours. The report wasn’t just moderately weaker, it was the biggest month-over-month drop in well over a year. There’s always a risk that rates will move higher, but days like today suggest that such a move is, by no means, a foregone conclusion. Full story…

* Buy Like Buffett: A Love Story. Below is a link to a video played at the Berkshire Hathaway HomeServices Convention earlier this month. Forbes produced the video telling one couple’s love story through Warren Buffett’s Berkshire Hathaway Inc. brands ending with a BHHS sign in front of the house the couple purchased. It is very cool how Forbes linked all the various Berkshire Hathaway companies ending with real estate. ​​

Have a productive week!




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