According to the Bureau of Labor Statistics, total nonfarm payroll employment rose by 164,000 in July 2019. This was slightly lower than the number of jobs added in June which was 193,000, but is still in line with 2019’s monthly average of 165,000 jobs added. Not all industries had the same change in employment. The education and health services industry contributed the most jobs, at 66,000. Other notable job gains were seen in manufacturing, financial activities, government, and financial/business activities. Meanwhile, jobs were actually lost in information, retail trade, and mining/logging. While the number of jobs added each month 2019 are smaller than the jobs gained in 2018 (which was 223,000 each month on average), it’s been enough to keep unemployment low. More here.
Americans are feeling financially confident, which is good news for the housing market. Fannie Mae’s latest Home Purchase Sentiment Index – which measures consumers’ perceptions of buying and selling a home, job security, mortgage rates, prices, etc. – hit a new high in July. Doug Duncan, Fannie Mae’s chief economist, says it’s due to favorable mortgage rates and increased job confidence. “Consumer job confidence and favorable mortgage rate expectations lifted the HPSI to a new survey high in July, despite ongoing housing supply and affordability challenges. Consumers appear to have shaken off a winter slump in sentiment amid strong income gains. Therefore, sentiment is positioned to take advantage of any supply that comes to market, particularly in the affordable category.” In other words, Americans are feeling good about their income and may be ready to buy. In fact, the survey found a 3 percent month-over-month increase in the number of respondents who said that now is a good time to buy a house. More here.
The U.S. Bureau of Economic Analysis announced last Friday that the trade in goods and services deficit went down by $0.2 billion in June from the month before. While this may not seem like much, it’s good news after two months of increases in the trade deficit. The decrease in the overall deficit was caused by a $0.8 billion decrease in the goods deficit, which was partially offset by a $0.6 decrease in the services surplus. Exports decreased by $1.7 billion and imports decreased by $0.6 billion, both during the three months ending in June. The decrease in exports was led by fewer consumer goods (like diamonds) and capital goods (like computer accessories) being sold. The decrease in imports was led by fewer industrial supplies (such as petroleum) and consumer goods (cell phones) being bought. More here.
For 17 consecutive months, pending home sales data showed contracts to buy homes were down on a year-over-year basis. After a jump in June, they’ve finally broken the streak. In fact, according to the National Association of Realtors® (NAR) Pending Home Sales Index – which measures the number of contracts to buy homes signed each month – they’re now nearly 2 percent higher than last year. Lawrence Yun, NAR’s chief economist, said favorable buying conditions have spurred a positive turn for home sales. “Job growth is doing well, the stock market is near an all-time high, and home values are consistently increasing. When you combine that with the incredibly low mortgage rates, it is not surprising to now see two straight months of increases.” In other words, conditions are good for buyers. After seeing homeowner equity double over the past six years, Americans are enthusiastic about homeownership. The report showed pending home sales up in all four regions, with the West leading the pack with a 5.4 percent month-over-month increase. More here.
When selling a house, there are a number of things you can do to make your listing more attractive to prospective homebuyers. Some obvious examples include an open house and professional photos, but the number one thing you can do to get a good response from buyers is to price it right. A perfectly staged house with professional photos isn’t going to sell quickly if it’s priced too high. According to a recent analysis by Redfin, lowering the price after your home’s been on the market awhile isn’t as effective as setting the price correctly the first time. In fact, when comparing the number of online views a home gets the day it’s listed as opposed to the day of a price drop, the initial listing gets almost three and a half times the number of views. In other words, you’ll never get another chance to make a first impression. The longer your home has been listed without selling, the more likely buyers will assume there is a reason no one has bought it yet. There is an easy way to avoid falling into this trap. Simply follow the guidance of the pros you have hired to help sell your […]
Last week, the U.S. Bureau of Labor Statistics reported that nonfarm payroll employment increased by 224 thousand in the month of June. This is up from the average of 172 thousand jobs added each month this year. The unemployment rate was little changed, and so was the labor force participation rate. The industry that added the most jobs was professional and business services at 51 thousand jobs. Other notable gains were seen in healthcare and transportation/warehousing at 35 thousand jobs and 24 thousand jobs, respectively. No industries showed a decrease in employment in June. Average hourly earnings for all private payroll employees went up by 6 cents in June, while the average length of the workweek was little changed. More here.
According to the Mortgage Bankers Association’s Weekly Applications Survey, demand for home purchase loans is now 10 percent higher than the same week one year ago. The improvement comes after a 1 percent increase week-over-week. Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting, says purchase applications have been gradually increasing since the beginning of the year. “Purchase applications picked up slightly last week, as conventional and government activity were each up around 1 percent. Furthermore, in continuation of the gradual growth trend seen throughout the first half of 2019, purchase activity was almost 10 percent higher than a year ago,” Kan said. “A still-strong job market, improving affordability, and lower mortgage rates continue to support growth.” Also in the report, average mortgage rates were mostly flat last week, showing little change across all loan categories. The 30-year fixed-rate was up slightly but remains just above lows last seen in 2016. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.
Whether to rent or buy is a common debate for Americans looking for a new place to live. The arguments are well known. Renters say it’s cheaper, if only because there are no upfront expenses like a down payment or closing costs. Homeowners, on the other hand, will point to the long-term financial benefits of owning a home, including equity and wealth creation. Ultimately, what you choose will be determined by factors specific to your life, goals and finances. However, homeownership is clearly winning the debate on one key issue according to a new survey from Freddie Mac. The survey results found that, “34 percent of renters spend more than one-third of their income on rent, while only 25 percent of homeowners spend that much on their mortgage.” In other words, though renters often view renting as the more affordable option, they are also spending a larger percentage of their monthly income on housing. Additionally, the survey found that 62 percent of renters said they have had to reduce spending on non-essential items to be able to afford their monthly payment. This is in contrast to just under half of homeowners doing so. More here.
For many Fannie Mae’s Economic and Strategic Research Group releases a monthly forecast detailing what lies ahead for the economy and housing market. Though their most recent release says the overall economy will slow this year, their outlook for the housing market is encouraging for potential home buyers and sellers. That’s because they see stability ahead. Doug Duncan, Fannie Mae’s chief economist, says there are a number of factors that should make market conditions more favorable this year. On housing, the recent dip in mortgage rates to their lowest level in over a year, combined with wage gains and home price deceleration, supports our contention that home sales will stabilize in 2019, Duncan said. The greatest impediment to both sales and affordability continues to be on the supply side, as new inventory, particularly among existing homes, is being met quickly by strong demand as evidenced by the already thin months’ supply hitting a new one-year low. In other words, conditions will be less volatile than they were last year but ultimately depend on how many homes are available for sale. If new home construction and listings can keep up with demand, it’ll help keep prices steady. http://fanniemae.com/portal/media/corporate-news/2019/economic-housing-outlook-041819-6859.html?utm_source=AKZO+Media+Subscribers&utm_campaign=4c297931ff-EMAIL_CAMPAIGN_2019_04_18_06_48&utm_medium=email&utm_term=0_134f701abc-4c297931ff-276542805
The typical home seller lives in their house for more than a decade before they put it up for sale. During that 10 years, there are probably a few things they let go. It’s no surprise that the vast majority of them feel the need to fix their place up before putting in on the market. In fact, according to a recent analysis by Zillow, nearly 80 percent of home sellers complete one home improvement project before they invite potential home buyers to have a look. This can include anything from a fresh coat of paint to a bathroom remodel. Fortunately, the money that sellers spend on their home often helps them sell it for more than their asking price. So, if you’re thinking about selling, how much should you expect to spend on home improvement projects? The national average is $6,570, though it does depend a lot on where you are. For example, in San Francisco, sellers usually spend closer to $8,000, while in St. Louis the cost is under $4,000. Wherever you are, it’s good to consider what needs to be repaired and which projects are most likely to provide some return on your investment. https://www.prnewswire.com/news-releases/sellers-spend-nearly-21-000-to-sell-a-home-in-2019–300827684.html?utm_source=AKZO+Media+Subscribers&utm_campaign=f4b978c9e7-EMAIL_CAMPAIGN_2019_04_09_04_13&utm_medium=email&utm_term=0_134f701abc-f4b978c9e7-276542805