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Economic News in Review Greenville SC - March 05, 2014

By
Mortgage and Lending with Movement Mortgage NMLS #322952

Economic News in Review Greenville SC

Here is last week’s Economic News in Review Greenville SC.

 

While developments in the Ukraine and Venezuela dominated last week's news, some noteworthy economic developments were announced, including a surprise spike in new home sales, an unexpected climb in new jobless claims, and a confusion among the two leading consumer outlook indices.

New Real Estate

Sales of newly built homes hit a five-and-a-half-year high in January, with completed transactions of new single-family homes hitting an annual rate of 468,000, the Census Bureau and the Department of Housing and Urban Development reported last week. January's sales marked a healthy 9.6 percent climb from December's revised rate of 427,000, and were 2.2 percent higher than January 2013's pace of 458,000.

Looking at price and inventory, the median price of new homes sold in January rang in at $260,100, and the average sales price was $322,800. The estimated number of new homes for sale at the end of January was 184,000, which represented a supply of 4.7 months at January's sales rate.

It's important to note that new home sales can become volatile, and comprise a smaller portion of the real estate market than existing home sales. That said, housing market watchers are expecting overall growth for the real estate market through 2014.

“Despite higher mortgage rates, the fundamentals for new-home sales and residential construction are solid,” PNC Financial Services Group chief economist Stuart Hoffman told the Washington Post last week. “The economy is adding jobs and incomes are growing, making households more confident.”

Initial Jobless Claims

First time claims for unemployment insurance filed by the newly unemployed during the week ending Feb. 22 experienced an unexpected increase, according to figures released by the Employment and Training Administration last week. Initial jobless claims, grew by 14,000 claims to 348,000, outpacing the market expectation of 335,000 claims.

That said, the four-week moving average, considered a more reliable gauge of current employment activity, came in at 338,250, which was unchanged from the previous week's revised average.

Most analysts chalked up the jobless claim spike to February's continued poor weather and its impact on business overall. Moreover, some, such as Millan Mulraine, deputy head of U.S. research and strategy at TD Securities USA LLC, said they expect a better labor market once the sun comes out.

“We still have a fairly constructive view on the labor market,” Mulraine said in an interview with the Bloomberg news service. “There have been some weather-related setbacks in hiring, but as it warms up, you're going to see much better performance in labor market activity.”

Consumer Outlook

The glum weather and its economic impact, resulted in a mixed bag of consumer opinions, according to last week's news. On the one hand, The Conference Board's Consumer Confidence Index, fell to 78.1 in February from 79.4 in January (a baseline of 100 was set in 1985). On the other hand, The University of Michigan-Thomson Reuters Consumer Sentiment Index hovered at 81.2 in February, unchanged from January. And it should be noted that analysts polled by Reuters had actually expected a dip in February to 80.6.

To add to the discontinuity between the two indices, the drop in Consumer Confidence was driven by the Expectations Index (how consumers feel their economic prospects will fare), which dropped to 75.7 in February from 80.8; and the drop in the Consumer Sentiment was driven by consumer's take on current economic conditions, which slipped to 94 in February from 96.8 in January.

If anything, this confusion over how to read the economy, whether on the part of the experts or the part of the consumers, is probably proof that this winter's combination of frigid temperatures in the East and Midwest, along with drought conditions on the west coast has obscured everyone's crystal ball. Hopefully when the weather clears, so to will everyone's perspective on the economy.

This week we can expect:

  • Monday — Personal incomes and spending for January from the Bureau of Economic Analysis; January construction spending from the Census Bureau; car and truck sales for February from the auto makers.
  • Thursday — Initial jobless claims for last week from the Employment and Training Administration; Fourth Quarter productivity scores from the Bureau of Labor Statistics; January factory orders from the Census Bureau.
  • Friday — February unemployment rate, payrolls, workweek and earnings from the Bureau of Labor Statistics; January consumer credit totals form the Federal Reserve.

Economic News in Review Greenville SC

Have a Big day,

Randy

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Movement Mortgage, LLC is an Equal Housing Lender. NMLS # 39179 | 877-314- 1499. Movement Mortgage, LLC is licensed by the "South Carolina Board of Financial Institutions" Lic # MLS-39179. Interest rates and products are subject to change without notice and may or may not be available at the time of loan commitment or lock-in.  Borrowers must qualify  at  closing  for  all  benefits. “Movement Mortgage” is a registered trademark of the Movement Mortgage, LLC, a Delaware limited liability company.

Posted by

Randy Shamburger

Senior Mortgage Lender 

NMLS# 322952        

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Comments (3)

Roy Kelley
Retired - Gaithersburg, MD

Have an outstanding month as home buyers continue to take advantage of the very attractive morgage interest rates.

Mar 06, 2014 02:24 AM
Endre Barath, Jr.
Berkshire Hathaway HomeServices California Properties - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Randy what a great economic and political summary of the state of affairs, I was considering writing about it as well, Endre

Mar 10, 2014 04:31 PM
Kwee Huset
Kwee Huset Realty - Venice, FL
Venice Florida Homes For Sale

Hi Randy, despite war is going on in Ukraine, some currency exchange rates were improved.

Mar 13, 2014 12:23 PM