Many people were excited about the seemingly strong home sales numbers from yesterday. Pessimist economist David Rosenberg has a different take.
Sometimes you just have to go and get your hands dirty and look at the numbers beneath the number. All of the sales increase in July, and then some, were in “houses not yet started”, which ballooned 33.0% both month-over-month and year-over-year. So, this is spec buying, and guess what? These orders can always be cancelled, by the way. Meanwhile, sales of completed units fell 6.0% sequentially and are down 24.0% from year-ago levels.
Aug 27, 2009 11:28 AM
The recession's painful toll on the U.S. industrial sector will be long-lasting, Atlanta Federal Reserve President Dennis Lockhart told the Chattanooga Chamber of Commerce Wednesday.
Lockhart said these 'structural adjustments' in employment will likely weigh down GDP growth in the medium term. But he added that 'stabilization has taken hold, and the beginning stages of recovery are under way.'
Aug 27, 2009 6:42 AM
Writing on his Digital Rules blog, Rich Karlgaard says Tennessee's low-tax environment is helping it avoid what he expects will be a long, slow slog back to growth for much of the country.
Gross averages never tell the story in a country as large as the U.S. Beneath the expected subpar, U-shaped recovery lies the reality of the American economy: A highly uneven collection of Vs and Ws.
Aug 25, 2009 2:30 PM
Because it's hard to say the home price index for 20 of the country's largest cities (but not Nashville) is in good shape when it's down 'only' 15.4 percent.
From a month earlier, home prices climbed 1.4 percent in June, the second consecutive gain and the biggest since June 2005, today’s report showed. The figures aren’t adjusted for seasonal effects, so economists prefer to focus on year-over- year changes instead of month to month. “We are seeing some positive signs,” David Blitzer, chairman of the index committee at S&P, said in a statement. “There are hints of an upward turn from a bottom.”
Aug 25, 2009 8:32 AM
A research firm that tracks how many home sellers are lowering their prices puts Nashville 18th in the country. The average price cut this month is 7 percent.
"Even as the volume of sales are starting to rise nationally, the median home price continues to fall," said Pete Flint, Trulia co-founder and CEO. "The reality is, today's sellers need to price aggressively to avoid reductions. Consumers are looking for value and when they find a good deal, they are taking advantage of market conditions."
Aug 14, 2009 1:06 PM
In a broad update of the economic picture, David Penn at MTSU's Business & Economic Research Center says it does no good to look for big improvements in national or regional statistics. You're only setting yourself up for sadness.
• Don’t make year-to-year comparisons (it is too depressing). • Make comparisons with the previous month or previous quarter. • Forget about ‘recovery’; settle for sustained improvement.
Aug 13, 2009 11:59 AM
Gluskin Sheff economist David Rosenberg points out what several others are saying: As much as housing's collapse has hurt lenders, the expected crash coming in commercial real estate will hurt worse.
Zillow just reported that 23% of U.S. homeowners are “upside down” on their mortgages (negative net equity), up from 21% in 1Q, and under current home price trends, with all deference to the tentative signs of ‘stabilization’ at the low end, that share will rise to 30% next year. That cannot possibly be good news for the U.S. financials, especially since we know that commercial real estate loan defaults are going to be an even bigger problem for the lending community.
Aug 12, 2009 11:40 AM
DataQuick Information Systems has crunched second-quarter local home sales numbers by ZIP code. Some details: Prices rose in 10 ZIP codes versus a year ago — including in East Nashville and Sylvan Park — while downtown's 37201 is among the biggest losers over the past 12 months. On the sales front, it's interesting to note that Rutherford County's numbers fell by 18 percent versus more than 30 percent for both Davison and Williamson counties. In all, 16 ZIP codes from those three counties saw sales fall 30 percent or more.
Aug 11, 2009 12:59 PM
The Volunteer State's housing market continued its slow recovery, according to the researchers at MTSU's Business & Economic Research Center.
As long as mortgage rates remain low and consumers slowly regain confidence, continued gradual improvement in the housing market can be expected. More robust growth for the housing market depends on sustained job growth, which for the present appears to be in the distant future.
Aug 10, 2009 11:16 AM