The supply crisis in the housing market is not letting up, and consequently neither are the gains in home values.
National home prices continued their run higher in November, rising 6.2 percent annually on S&P CoreLogic Case-Shiller’s most broad survey, up from 6.1 percent in October. Another S&P index of the nation’s 20 largest housing markets showed a 6.4 percent gain, higher than analysts had expected.
Prices nationally are now 6 percent higher than their 2006 peak, while those in the top 20 markets are still 1.1 percent lower.
“Home prices continue to rise three times faster than the rate of inflation,” says David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices.
Blitzer blames the continued lack of supply for the price gains, citing a very slow recovery in the home construction market. Home builders are ramping up production but are still not at even historically normal levels, never mind the huge pent-up demand in the market.
“Without more supply, home prices may continue to substantially outpace inflation,” added Blitzer
Local metropolitan markets seeing the highest gains are those that were rising fastest before the financial crisis. San Diego, Los Angeles, and Las Vegas continue to see strong gains. Seattle and San Francisco are seeing the highest gains of all, due to strong employment and very tight supply in both those markets.
Consumer optimism pushed higher than anticipated in January, after a surprise decline the previous month.
The Conference Board’s measure of consumer confidence rose to 125.4 in January, higher than the 123.1 anticipated by economists polled by Reuters. The measure had declined to 122.1 in December.
The key index rose to 129.5 in November, the highest mark since the index hit 132.6 in November 2000.’
“Expectations improved, though consumers were somewhat ambivalent about their income prospects over the coming months, perhaps the result of some uncertainty regarding the impact of the tax plan,” Lynn Franco, Director of Economic Indicators at The Conference Board, said in a statement.
“Consumers remain quite confident that the solid pace of growth seen in late 2017 will continue into 2018,” Franco said.
What will Brexit mean for the British economy?
Executives, forecasters and bankers have been trying to answer that question for at least two years. The U.K. government has done its own analysis, and a leaked draft Tuesday makes for ugly reading.
BuzzFeed reported that the government analysis suggests Brexit will reduce economic growth by between 2% and 8% over 15 years.
“This was initial work, not approved by ministers, which only considers off-the-shelf scenarios. No analysis was made of the bespoke [trade] arrangement we seek as a matter of government policy,” a spokesman for Prime Minister Theresa May told reporters.
But never mind the future, there’s already plenty of evidence that the June 2016 vote by Britain to leave the European Union — by far its biggest export market — is already causing damage. And that’s with at least a year of fraught negotiations on the uncertain relationship between the U.K. and EU still to come.
Gold has started the week with losses. In North American trade, the spot price for an ounce of gold is $1341.32, down 0.62% on the day. On the release front, Personal Spending slowed to 0.4%, shy of the estimate of 0.6%. On Tuesday, the key indicator is CB Consumer Confidence and President Trump will deliver […]
The dollar has been falling for quite sharply and we explain why. It’s not the US economy: we digest the latest US GDP report which gives something for everybody before concluding with a preview as February begins. You are welcome to listen, subscribe, provide feedback and pledge support on Patreon. Dollar demise: Mnuchin’s endorsement of a […]
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