Estate and mortgageReal Estate Outlook: Sales Stats and Rates
We"ve got a bumper crop of positives this week for housing, starting with pending home sales, which jumped by 6.4 percent in August.
That was the seventh straight month of increases in the National Association of Realtors" forward-looking index -- the longest streak since 2001.
The pending sales index measures signed contracts heading for closing, and is an important indicator of where the real estate market is headed in the coming couple of months.
Regionally, pending sales were up by 8.2 percent in the Northeast, 7.6 percent in the Midwest, by just less than one percent in the South, and up a stunning 16 percent in the Western states.
But pending sales are hardly the only bright spot this week: New home sales were also up in the latest month -- by seven tenths of one percent nationwide, according to the Commerce Department.
Even home prices, which had been on the negative side in dozens of areas for most of 2008 and into early 2009, have now turned around and are rising just about everywhere. The Case-Shiller 20-city price index took its biggest jump in four years last month, up by 1.6 percent.
Prices were positive coast to coast, with Los Angles and Washington D.C. up 1.8 percent, San Francisco 3.3 percent, Chicago 2.7 percent and Minneapolis up an extraordinary 4.6 percent for the month.
And remember: the Case-Shiller index has been the darkest, gloomiest measure of the real estate market"s direction for years, and the last major index to turn around this year. So it"s a very welcome change we"re looking at here.
Mortgage rates continued to be helpful as well last week, with rates continuing their slide. Average 30-year fixed rates dipped to 4.9 percent, according to the Mortgage Bankers Association, while fifteen year rates dropped to 4.3 percent.
If rates slip just a few more notches, they"ll be approaching 40-year low points ... and we could see not only a spike to home sales, but a refinancing boom as well.
Now of course, the news never all bright in any given week. We saw a surprise drop last week in a key measure of consumer confidence -- the Conference Board"s index, which slipped by 1.4 points after months of generally improving outlook among consumers.
Analysts attributed widespread worries about future job layoffs and a national unemployment rate close to 10 percent -- and much higher rates in some major local markets -- to the drop in confidence.
Unemployment is obviously sobering, and no doubt is restraining the housing sector. But all in all, that sector looks very promising at the moment.