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Rising confidence, fewer firings and gains in holiday sales show the U.S. economy is picking up, defying a slowdown in Europe and much of the rest of the world.
The divergence will become even starker in 2012 as the world’s largest economy accelerates, the 17-member euro area sinks into a recession and growth in emerging markets cools, according to economists like Maury Harris of UBS Securities LLC and Barclays Capital Inc.’s Dean Maki.
“There is a sense of decoupling,” said Harris, chief economist at UBS Securities in New York, whose team was the most accurate in forecasting the U.S. economy in the two years through September. “We can still have a decent year here in the U.S. even with the rest of the world slowing down.”
Housing and auto sales, two areas which slumped during the recession, will probably improve.
An improving job market and freer credit may underpin American household sentiment and spending just as the debt crisis in Europe prompts additional belt-tightening overseas. Stabilization in housing will erase a source of weakness at the same time [Read more...]
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Pending home sales continued to gain in November and reached the highest level in a year and a half as mortgage rates remain low, according to the National Association of Realtors®.
The Pending Home Sales Index,* a forward-looking indicator based on contract signings, increased 7.3 percent to 100.1 in November from an upwardly revised 93.3 in October and is 5.9 percent above November 2010 when it stood at 94.5. The October upward revision resulted in a 10.4 percent monthly gain. [Read more...]
In the last few years, Americans have experienced the most severe housing-market downturn since the Great Depression. The national homeownership rate during this period has declined from a peak of 69 percent in 2004 to 66 percent presently. Unemployment is high, income growth is stagnant and home sales are low. Indeed, in this environment, many have questioned whether the American dream of homeownership has ended.
A recent report that uses data from the University of Michigan’s Survey of Consumer Attitudes to examine consumer attitudes toward homeownership before, during and after the financial crisis has some interesting findings. In particular, it measures the extent to which the recession has changed consumer sentiment toward home buying and selling.
There are a number of principal findings:
• Despite high unemployment, slow economic growth and problems plaguing the economy, almost 80 percent of American households believe that now is a good time to buy a home.
• Positive sentiment is strong particularly among [Read more...]
Sales ticked up for existing homes and new homes, several real estate market indicators revealed last week, pointing to a housing market that may finally be entering recovery mode.
November sales of existing homes increased 12 percent year-over-year
In the most recent report, the Census Bureau reported that the new-home market continued its rebound, with sales of new houses once again inching up last month. New-home sales rose 1.6 percent from October to November to an annualized rate of 315,000, and sales were up nearly 10 percent compared to November 2010.
The median sales price of a new home in November was $214,100, the Census Bureau reported, and the inventory of new houses nationwide decreased to a [Read more...]
Yale University economist Robert Shiller says don’t be depressed by the sharp fall in house prices in October’s S&P/Case Shiller Index. Many reasons to buy now.
The Case-Shiller index, created by economists Karl E. Case and Robert J. Shiller, is widely considered the most reliable read on home values. The housing index compares the latest sales of detached houses with previous sales and accounts for factors such as remodeling that might affect a house’s sale price over time.