Economy Watch: Home Prices Show Biggest Gains Since ’06; Trade Gap Widens; Americans Living Large
- Jun 05, 2013
According to CoreLogic, which released its house price index for April on Tuesday, U.S. home prices were up 12.1 percent this April compared with April 2012. That jump includes distressed sales, and represents the largest annual increase in the index since February 2006, during the bubble expansion.
Excluding distressed sales, home prices increased on an annual basis by 11.9 percent in April, according to CoreLogic (which doesn’t adjust for seasonal variations). CoreLogic counts both short sales and REO transactions in its estimates of distressed sales. On a month-over-month basis, home prices increased by 3.2 percent in April, including distressed sales. Month-over-month, excluding distressed sales, home prices increased 3 percent in April.
“House price growth continues to surprise to the upside,” Mark Fleming, chief economist for CoreLogic, noted in a statement. “Increasing demand for new and existing homes, coupled with low inventory, has created a virtuous cycle for price gains, most clearly seen in the Western states with year-over-year gains of 20 percent or more.”
Trade Deficit Widens in April
Americans bought more from overseas in April than they sold to other countries—as usual—but the size of the deficit increased, the Bureau of Economic Analysis reported on Tuesday. Total exports of $187.4 billion and imports of $227.7 billion resulted in a goods-and-services deficit of $40.3 billion in April, up from $37.1 billion in March, the government found.
Most of the trade deficit is with China, which remained roughly the same in April as last year–$24.1 billion, compared to $24.5 billion in April 2013. The U.S. deficit with the euro zone was $10 billion in April, up from $7.8 billion last year. That’s mainly because the ailing economies of the euro zone have cut back on everything, including imports from across the Atlantic.
The drop in the price of oil in recent months meant that the deficit wasn’t quite as wide as it could have been, however. Though the price of oil rose slightly from March to April, it showed a significant year-over-year decrease—from $109.69 per barrel in April 2012 to $97.82 per barrel in April 2013.
Americans Like Living Large
On Tuesday, the Census Bureau released data about the stock of new housing completed nationwide during 2012, a total of 483,000 single-family homes. Of that total, 198,000 have four bedrooms or more, while only 63,000 have two or fewer. Houses well-equipped with bathrooms appear to be popular, too; 145,000 new homes have three or more, while only 34,000 have one and one-half or fewer.
Some 278,000 new homes have a warm-air furnace and 183,000 have a heat pump as the primary heating system; 285,000 heating systems are gas-powered 189,000 run on electricity. The majority of new homes – 266,000 – have two stories or more, and the average single-family house completed in 2012 measure 2,505 square feet.
After ending Monday on an upbeat note, Wall Street wobbled downward on Tuesday, with the Dow Jones Industrial Average dropping 76.49 points, or 0.5 percent. The S&P 500 and the Nasdaq were off 0.55 percent and 0.58 percent, respectively.