You might not hear much about them on TV or in the papers, but there are some economic signs popping up right now that are -- at the VERY least -- encouraging for housing and real estate.
Take the gold standard of all forward indicators for the U.S. economy -- the Conference Board's "Index of Leading Indicators," which is based on a broad survey of industry data and predicts economic activity three to six months down the road.
The latest Conference Board index registered its first increase in six months. Now I know that all we hear about these days is recession: it's either already here or it's about to happen. But the index suggests that there should be positive growth underway in the second half of the year, if not sooner. Look at the stock market, it's starting it's upward trend again.
The National Bureau of Economic Research which found that industrial production in the U.S. showed an unexpected uptick in March.
Here are some other noteworthy developments this past week:
- Applications for mortgages to buy houses were up again, it was the second straight week, according to the Mortgage Bankers Association of America's national survey. Applications for FHA loans to buy houses jumped by three and a half percent -- and conventional purchase applications rose 2.1 percent.
- The federal government reported that house prices nationwide stopped their slide between January and February -- and actually increased by six tenths of one percent.
- Interest rates remain well under 6 percent, according to the Mortgage Bankers, with 30-year fixed rate loans last week averaging 5.74 percent and 15-year loans at 5.27 percent. The Federal Reserve is likely to knock another quarter percent off short term rates next week.
- Freddie Mac announced plans to pump up to 15 billion dollars into the "jumbo conforming" loan market -- those are for high cost areas that really need some stimulus right now, like California.
Now, positive-sounding economic developments are not ballgame-changers for real estate. We've still got lots of housing inventory to sell before calling an end to the down cycle -- and total sales dipped 2 percent in March, according to the National Association of Realtors.
We're still dealing with a lack of confidence on the part of some consumers who are afraid that maybe prices still have a ways to fall.
But here's the point: It's undeniable that there are some glimmers out there that the underlying economy and financing marketplace, which after all are what support real estate activity, finally may be headed in a positive direction.
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