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Minnesota Mortgage Blog

August 24th, 2011 12:44 PM

Last week saw lackluster real estate headlines with sales of existing homes of all types (single-family homes, townhomes, condominiums and co-ops) dropping to an annual rate of 4.67 million in July, a 3.5 percent to decline from June's 4.84 million, the National Association of Realtors reported last week. NAR experts said that while the market offered attractive pricing and financing terms, more buyers needed to obtaining financing so that they could participate in the market, which would ultimately spur a recovery.

Looking at the market's pricing, NAR said the median price for existing homes of all types had dipped to $174,000 in July, which was a 4.4 percent decrease from July 2010. Distressed homes (foreclosures and short sales) comprised 29 percent of July's sales, slightly down from 30 percent in June and 32 percent in July 2010.

Meanwhile, building permits issued for for private housing units issued dipped in July to an annual rate of 597,000, the Census Bureau reported last week. This marked 3.2 percent decline from June's revised rate of 617,000. That said, it was 3.8 percent above July 2010's estimate of 575,000. Construction permits issued for single-family authorizations in July showed a slight increase, ramping up to a rate of 404,000, a 0.5 percent increase over June's revised rate of 402,000.

The number of unemployed workers making first-time claims for unemployment benefits for the week ending Aug. 13 was 408,000, the Employment and Training administration reported last week. This marked an increase of 9,000 from the previous week's number of jobless claims. The total number of out of work Americans covered by unemployment insurance workers hit 3,702,000 during the week ending Aug. 6, representing an increase of 7,000 from the previous week's level of 3,695,000.

Starts of construction on privately owned homes dipped to an annual rate of 604,000 for July, a 1 5 percent decrease from June's revised estimate of 613,000. That said, it was 9.8 percent above July 2010's rate of 550,000. Construction starts for single-family homes in July dropped to a rate of 425,000, which was 4.9 percent below the revised June figure of 447,000.

Consumer prices were on the rise for July, according to last week's report from the Bureau of Labor Statistics, which reported that its consumer price index for all urban consumers (CPI-U) rose 0.5 percent for the month. This was driven by the gasoline index, which rose sharply in July to account for roughly half of the month's increase. Also dairy and fruit prices increased, which caused a jump in grocery prices.

Similarly, July's producer price Index for finished goods was up, increasing 0.2 percent, according to the bureau. Looking at the range of producer costs for July, intermediate goods increased by 0.2 percent in July, while crude goods declined 1.2 percent.

This week, we can expect:

Tuesday — New home sales for July from the Census Bureau.
Wednesday — Durable goods orders for July from the Census Bureau.
Thursday — Initial jobless claims for the week ending Aug. 20 from the Employment and Training Administration.
Friday — Q2 gross domestic product from the Bureau of Economic Analysis; August consumer sentiment from the University of Michigan.

Posted by Jamie Larkin, Mortgage Advisor on August 24th, 2011 12:44 PMPost a Comment (0)

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