Gridlock in Congress But Home Sales Steadily Rising

There was a time in our recent memory that the threat of $85,000,000,000 (That is Billion with a “B”) would have a major negative impact on the markets, interest rates, and even consumer confidence.  Yet, even though our elected officials have once again proven that they cannot work together, the markets do not seem to be paying much attention to Washington’s gridlock.  It is clear that almost everyone believes that Congress will somehow come up with some type of temporary stop-gap piece of legislation that will prevent what is supposed to happen, from happening. 

Well…it is Friday morning and Congress has worked through the night and still there is no resolution or solution.  The stock market futures as of this moment are only down slightly and interest rates are virtually unchanged, so I guess most people simply are not paying attention, or they are just numb to it.

In the end, we know that our elected officials will come up with something that will not solve any of our financial woes in this country.  We continue to increase our debt, and despite all the shouting from the mountain top that this needs to stop, I guarantee that once again our elected officials will “kick the can down the road” and not do anything to curtail spending.

Housing was the big news maker this week as there were 4 key housing reports released.  Here is the recap:

• FHFA House Price Index - Home prices continue to increase gradually.  The FHFA price index for December increased 0.6 percent which follows November’s rise of 0.4 percent.

• Case-Shiller Home Price Index - Home prices continue to rise by a very strong 0.9 percent for December's 20-city adjusted Case-Shiller index. This pace of increase is the best since last year's second quarter when monthly gains averaged 1.0 percent. From the same time last year the index is up 6.9 percent which is the highest since the giant housing bubble back in 2006.

• Pending Home Sales Index – The pending home sales report points to strong improvement for February. The number of contracts signed to purchase an existing home rose 4.5 percent from the prior month.  One of the biggest challenges to home sales is that properties for sale on the market are scarce and the pace of increasing sales is draining what inventory there is.  The market, believe it or not, is starting to return to the seller’s advantage.

• New home sales in January surged a monthly 15.6 percent to an annualized 437,000 from an upwardly revised 378,000 for December. The latest number well topped market expectations.

Next week’s market moving reports are few and far between:

 

• Wednesday March 6^th - MBA Applications, ADP Employment Report and Factory Orders
• Thursday March 7^th - First Time Jobless Claims
• Friday March 8^th – National Unemployment

I appreciate your business and look forward to talking to you soon! Have a great day!!!
 

Sincerely,

Cindy Tomlinson
Loan Officer

USLending Company

DRE Lic # 01520422
NMLS # 214851   

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