By Fred Arnold
Before I give this week’s Real Estate and Market Report I wanted you to know we moved our offices this past week to 28368 Constellation Road #398, Santa Clarita, CA 91355. Our numbers have stayed the same. Come visit our beautiful new home!
After weeks of mostly positive economic news, we were destined for a step back in which the economic data is more mixed. The economy still appears to be on a mending path, however the mixed signals are reappearing in some of the economic data.
The big headline of the week of course is the national unemployment data released on Friday morning. The employment picture showed unexpected growth in that the labor force increased by a much larger than expected 243,000. This jump lowered the national unemployment rate down to 8.3% whereas most experts were expecting it to stay the same or increase slightly. Outside of the national unemployment numbers, First Time Jobless Claims declined by 12,000 from the previous week as well. The more positive news is that continuing claims dropped a very large 130,000. Both reports indicate that employment is trending in the right direction.
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S&P Case-Shiller Home Value Index continues to show weakness in housing. December marked the 3rd straight monthly decline in home values with a .7% drop. Also in the report is that prices are down 3.7% from the same time last year. On the flip side, construction spending increased a more than expected 1.5%. Overall construction spending is up 4.3% from a year ago. What cannot seem to be explained is builder optimism. Home prices and home sales have been very unstable yet builders seem to be optimistic and about the future and are backing up their optimism with construction spending.
Despite interest rates remaining very low, it appears that buyers continue to remain nervous about making purchase decisions. The MBA reported that last week purchase applications declined 1.7%.
The less than stellar economic news this week seems to be reinforced by the latest consumer sentiment readings. In recent months we have seen consumer confidence rising, however rising gas prices and a lousy job market seem to be weighing on the minds of consumers and lately the feeling that the economy is heading in the right direction is dwindling.
Next week’s economic reports are:
- · Wednesday February 8th – MBA Report, and 10YR Note Auction
- · Thursday February 9th – First Time Jobless Claims
- · Friday February 9th – Consumer Sentiment
As your mortgage professional, I am happy to assist you with any information you may need regarding mortgage or real estate information. I welcome the opportunity to serve you in any way I possibly can. Please feel free to reach me at 661-505-4300.