In the News

Retail sales rose 1.1% to $412.9 billion in September. This follows an upwardly revised 1.2% increase in August. Compared to September 2011, retail sales have increased 5.4%.

Consumer prices rose 0.6% in September, following an identical 0.6% increase in August. Compared to September 2011, consumer prices have risen 2%. Consumer prices at the core rate — excluding volatile food and energy prices — were up 0.1% in September.

The National Association of Home Builders/Wells Fargo monthly housing market index rose one point in October to 41, the highest level since June 2006. This marks the sixth consecutive monthly gain. An index reading below 50 indicates negative sentiment about the housing market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending October 12 fell 4.2%. Refinancing applications decreased 5%. Purchase volume rose 1%.

The combined construction of new single-family homes and apartments in September rose 15% to a seasonally adjusted annual rate of 872,000 units. Single-family starts increased 11%. Volatile multifamily starts rose 25.1%. Compared to a year ago, housing starts were up 34.8% in September. Applications for new building permits, seen as an indicator of future activity, rose 11.6% to an annual rate of 894,000 units.

Existing home sales fell 1.7% in September to a seasonally adjusted annual rate of 4.75 million units from 4.83 million units in August. Compared to a year ago, existing home sales were up 11% in September. The inventory of unsold homes on the market fell 3.3% to 2.32 million in September, a 5.9-month supply at the current sales pace, down from a 6.1-month supply in August.

Initial claims for unemployment benefits for the week ending October 13 rose by 46,000 to 388,000. Continuing claims for the week ending October 6 fell by 29,000 to 3.25 million.

from Prospect Mortgage Economic Update

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Last Week in the News

Retail sales fell 1.5% for the week ending August 18, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.1%.

Existing home sales rose 2.3% in July to a seasonally adjusted annual rate of 4.47 million units from 4.37 million units in June. Compared to a year ago, existing home sales were up 10.4% in July. The inventory of unsold homes on the market increased 1.3% to 2.4 million in July, a 6.4-month supply at the current sales pace, down from a 6.5-month supply in June.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 17 fell 7.4%. Refinancing applications decreased 9%. Purchase volume rose 0.9%.

New home sales rose 3.6% in July to a seasonally adjusted annual rate of 372,000 units from an upwardly revised rate of 359,000 units in June. The initial June reading was 350,000. On a year-over-year basis, new home sales are up 25.3% compared with July 2011. At the current sales pace, there’s a 4.6-month supply of new homes on the market.

Orders for durable goods — items expected to last three or more years — rose $9.4 billion or 4.2% to $230.7 billion in July. This increase follows a 1.6% increase in June. Excluding volatile transportation-related goods, July orders posted a monthly decrease of 0.4%.

Initial claims for unemployment benefits for the week ending August 18 rose by 4,000 to 372,000 from an upwardly revised 368,000 the prior week. Continuing claims for the week ending August 11 also rose by 4,000 to 3.317 million.

from Prospect Mortgage Economic Update

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Last Week in the News

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — rose 0.7% in February, following a revised 0.2% increase in January. The February reading was the highest level since June 2008.

Initial claims for unemployment benefits for the week ending March 17 fell by 5,000 to 348,000, the lowest reading since February 2008. Continuing claims for the week ending March 10 fell by 9,000 to 3.35 million.

The combined construction of new single-family homes and apartments in February fell 1.1% to a seasonally adjusted annual rate of 698,000 units, after an upwardly revised gain of 3.7% in January. The January figure was revised from 699,000 units to 706,000 units. Compared to a year ago, housing starts are up 34.7%. Applications for new building permits, seen as an indicator of future activity, rose 5.1% to an annual rate of 717,000 units.

Existing home sales fell 0.9% in February to a seasonally adjusted annual rate of 4.59 million units from an upwardly revised 4.63 million units in January. The inventory of unsold homes on the market increased 4.3% to 2.43 million, a 6.4-month supply at the current sales pace, up from a 6-month supply in January.

New home sales fell 1.6% in February to a seasonally adjusted annual rate of 313,000 units from a downwardly revised rate of 318,000 units in January. The initial January reading was 321,000. The December rate was revised higher to 336,000 units, the highest level since the economic recovery began. On a year-over-year basis, new home sales are up 11.4%. At the current sales pace, there’s a 5.8-month supply of new homes on the market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending March 16 fell 7.4%. Refinancing applications decreased 9.3%. Purchase volume fell 1%.

from Prospect Mortgage Economic Update

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Last Week in the News

The combined construction of new single-family homes and apartments in November rose 9.3% to a seasonally adjusted annual rate of 685,000 units. Single-family starts increased 2.3%. Multifamily starts rose 25.3%. Applications for new building permits, seen as an indicator of future activity, rose 5.7% to an annual rate of 681,000 units.

Existing home sales rose 4% in November to a seasonally adjusted annual rate of 4.42 million units from 4.25 million units in October. The inventory of unsold homes on the market decreased to 2.58 million, a 7-month supply at the current sales pace, down from a 7.7-month supply in October.

The Commerce Department announced that gross domestic product — the total output of goods and services produced in the U.S. — increased at a revised annual rate of 1.8% in the third quarter of 2011.

New home sales rose 1.6% in November to a seasonally adjusted annual rate of 315,000 units from a revised rate of 310,000 units in October. Compared to a year ago, new home sales were up 9.8%.

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — rose a strong 0.5% in November, following a 0.9% increase in October.

Orders for durable goods — items expected to last three or more years — rose $7.5 billion or 3.8% to $207 billion in November. Excluding volatile transportation-related goods, orders posted a monthly increase of 0.3%.

Initial claims for unemployment benefits fell by 4,000 to 364,000 for the week ending December 17. Continuing claims for the week ending December 10 fell by 79,000 to 3.546 million.

PS – The Federal Housing Administration (FHA) has extended the temporary waiver of anti-flipping regulations through December 31, 2012.

from Prospect Mortgage Economic Update

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Entering the Home Market in a Small Way

Some first-time home buyers are looking to enter the housing market in a small way.  And they’re doing so by buying small houses.  In some cases, very small houses.

The website of the Small Home Society (resourcesforlife.com/small-house-society) suggests the current interest in small homes resulted from weather-related catastrophes such as hurricanes and wildfires, as well as concern for the environment.  A shifting economy also has encouraged people to think about living more simply and scaling back.  Some architects and builders have recognized these trends and responded with small housing options.

One company, Tumbleweed Tiny House, offers fifteen models and variations of tiny homes.  A small home from Tumbleweed is designed to be placed in one location and meet International Building Code.  Each home has at least one room of no less than 120 square feet, and all home plans have the option for a 1st floor bedroom.  Tumbleweed’s bestseller is the B53, its largest home.  It can be built as a 2 bedroom (777 sq. ft.) or 3 bedroom (874 sq. ft.) house.  the estimated cost for the B53 is $51,000 for the 777 square foot home or $58,000 for the 874 square foot home.  Most of the homes have built-in cabinets and desks, finished interiors and stainless steel kitchens.

The smallest of the small homes, labeled tiny homes, range from 65-140 square feet and are built on wheels.  Because they are considered travel trailers, they do not require a permit and can be placed anywhere you can place an RV.

Micro-home pricescan start at under $20,000 and can range much higher depending on the desired amenities, such as granite countertops.

In addition to potentially much-smaller mortgage payments, energy consumption and energy bills are drastically reduced because of the smaller square footage.  Because of better insulating and sealing techniques, small hoes stay cooler in summer and warmer in winter.

Smaller homes means minimal time spent cleaning, because there is a very limited area to clean.  These homes also encourage a minimalist approach towards possessions.  When space is truly at a premium, a purchase of a new pair of shoes necessitates getting rid of an old pair to make room.

Manufacturers have responded to the limited amount of space with some adaptions of traditional appliances.  There is a washer/dryer combo on the market that washes clothes and then goes right into a dry cycle in the same unit.  It elimates the need to transfer wet clothes from one unit to the other.  It needs no venting and uses a 110 volt outlet.

What about breakfast?  There is a 3-in-1 breakfast maker that combines the convenience of three appliances in one.  It features a toaster oven and coffee maker side to side, and a griddle surface on the top.  You can make eggs, toast, and coffee in a space the size of a toaster.

And there are refrigeration units even smaller than the under the counter sizes found in some dorm and hotel rooms.  The drawer refrigerator fits in th tiniest of spots and lives up to its name, sliding out as  10 inch deep, 17.5 inch by 26.5 inch drawer.

from Tek Inspections enews

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Economic Update – News from Last Week

The National Association of Home Builders/Wells Fargo monthly housing market index was unchanged in May at 16. An index reading below 50 indicates negative sentiment about the housing market.

The combined construction of new single-family homes and apartments in April fell 10.6% to a seasonally adjusted annual rate of 523,000 units. Single-family starts decreased 5.1%. Multifamily starts fell 24.1%. Applications for new building permits, seen as an indicator of future activity, fell 4% to an annual rate of 551,000 units.

Industrial production at the nation’s factories, mines and utilities was unchanged in April, following a revised 0.7% increase in March. Compared to a year ago, industrial production is up 5%. Capacity utilization was 76.9% in April.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending May 13 rose 7.8%. Refinancing applications increased 13.2%. Purchase volume fell 3.2%.

Existing home sales fell 0.8% in April to a seasonally adjusted annual rate of 5.05 million units from a revised 5.1 million units in March. The inventory of unsold homes on the market increased 9.9% to 3.87 million, a 9.2-month supply at the current sales pace, up from an 8.3-month supply in March.

The index of leading economic indicators — designed to forecast economic activity in the next three to six months — fell 0.3% in April, following a revised 0.7% increase in March.

Initial claims for unemployment benefits fell by 29,000 to 409,000 for the week ending May 14. Continuing claims for the week ending May 7 fell by 81,000 to 3.7 million.

-Posted from Prospect Mortgage Economic Update

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