There is no better barometer on the health of the U. When the Fed made its surprise announcement last week of a decision to refrain from any further rate increases init was due in part to the persistent weakness in housing. Behind this worry is a simple truism: Sound economic growth in the U.
Keep abreast of significant corporate, financial and political developments around the world. Stay informed and spot emerging risks and opportunities with independent global reporting, expert commentary and analysis you can trust. By subscribing with Google you will be billed at a price in your local currency.
Access insights and guidance from our Wall Street pros. Find the product that's right for you. But how can you tell?
Since the burst of the housing bubble inwe entered the recession and hit the rock bottom in As the housing price is pushing to another new peak. I am sympathetic about affordability because I moved 10 times in the past 9 years in Seattle since the housing price directly impacts the rental market as well. Everyone wants to live in a comfortable place, especially for families with children.
O ne of the weirder responses to the Australian federal election result is articles suggesting that somehow all will be improved in the economy because the anticipation of an ALP win was the big driver of economic pessimism. This view is most egregiously put forward with respect to the housing market, where the story goes that as Labor was proposing changes to capital gains tax and negative gearing, people were holding off buying homes because of worries about house values. Thus with the Coalition winning the election, the market will now rebound.
CoreLogic says the housing downturn is losing steam as the pace of declining values continued to reduce in May. According to the latest ABS data, the value of lending commitments to households rose 0. Sure, the nationwide property market might still be trending down.
But sales are still This is having a stabilizing influence on home price activity. New listings also continue to drop with May numbers 7.
Home values rose in the Sydney market in the 10 days following the federal election, a signal that the long-awaited turnaround in the two-year property slump may already be underway. As a succession of positive news events reverberated through the weak market in the second half of May, property values rose 0. The upswing was not enough however to offset the broader 0. Home values in Melbourne also fell 0.
Cheaper mortgages are usually a boon to the housing market. To see why, take a look at what has happened in housing since mortgage rates began a sharp decline late last year. Consumer borrowing costs, including mortgage rates, are heavily influenced by the market for government bondsand yields on those bonds have been falling this year.
Our good friend John Rubino over at DollarCollapse. Rubino cites recent statistics that may indicate the US national housing market is finally entering Stage Two after a rip-roaring decade of recovery since the bursting of the housing bubble:. Taken together, these suggest that residential housing supply is increasing as sales slow, exactly what you'd expect to see in the transition from Stage One to Stage Two.