Economy Watch: Building Confidence Down; Apartment Market a Little Weaker; Foreclosures Drop in ’13
- Jan 17, 2014
Homebuilders are still fairly confident about their industry, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index, which was released on Thursday – but their confidence did edge down a bit. The index dropped one point in January to 56, from a revised December reading of 57.
All three of the index’s components dropped in January. The index gauging current sales conditions edged one point lower to 62, while the index reflecting expectations for future sales fell two points to 60. The index gauging traffic of prospective buyers fell three points to 40, remaining the only component below the optimism-pessimism threshold of 50.
“Rising home prices, historically low mortgage rates, and significant pent-up demand will drive a continuing, gradual recovery in the year ahead,” NAHB chief economist David Crowe said in a statement. “However, the pace of the recovery could be stronger were it not for rising construction costs and inaccurate appraisals that are keeping some home sales from going through.”
Apartment Market a Little Weaker
The National Multi Housing Council reported on Thursday that U.S. apartment market conditions weakened a bit at the beginning of the first quarter of 2014 compared with three months earlier. The organization’s market tightness (41), sales volume (41), and debt financing (42) indexes were all below the breakeven level of 50, although the equity financing index rebounded exactly to 50. The indexes last indicated overall improving conditions in July 2013.
The NMHC conducted the January 2014 Quarterly Survey of Apartment Market Conditions earlier this month; 157 CEOs and other senior executives of apartment-related firms nationwide responded. Some respondents noted that the decline was typical for this time of year and that conditions actually remain fairly tight.
“Apartment markets are little changed from October,” Mark Obrinsky, NMHC’s chief economist, said in a statement. “At least half of our respondents to each of our four main questions reported conditions as unchanged from three months earlier… New supply is finally starting to arrive at levels that will more closely match overall demand. Fundamentally, demand for apartment homes should be strong for the rest of the decade (and beyond).”
Foreclosures Drop in ’13
RealtyTrac released its Year-End 2013 U.S. Foreclosure Market Report this week, which shows foreclosure filings — default notices, scheduled auctions and bank repossessions — vexed about 1.361 million U.S. residential properties in 2013, down 26 percent from 2012, and down 53 percent from the peak of 2.9 million properties suffering foreclosure filings in 2010. The 2013 total was the lowest since 2007, when there were 1.3 million properties with foreclosure filings.
Wall Street ended the day mixed on Thursday, but mostly down. The Dow Jones Industrial Average lost 64.93 points, or 0.39 percent, while the S&P 500 was down 0.13 percent. The Nasdaq managed to gain 0.09 percent.