Binary Options News : September 27, 2012
Housing Markets in the US Are They Really That Bad?
This week in the US there is a raft of housing data that is scheduled to be released with S&P Case-Shiller Composite 20 house price index released early in the week followed by new home sales and then finishing off the week is pending home sales data. Most would agree that the data that has been coming through of late has given some signs that maybe there is some improvement in the US housing markets.
Firstly, looking at the S&P CS Composite 20 HPI which looks at the change in the selling price of single-family homes in 20 metropolitan areas now looks to be trending higher after bottoming out in March of 2009 at -19.00% it then peaked in July 2010 at 4.60% with the aid of US government intervention after all government interventions finished the US housing markets looked to be in trouble again and heading back south but managed to hold themselves to only slip down to -4.60% and now look set to turn positive again.
US new home sales have been a laggard but are showing some improvements versus the 2009 – 2011 slump. The housing market is a long way off getting back to the 2007 peaks but in this current cycle it is the most optimistic it has been in face of the huge headwinds faced by the US home buyers. Year to date new home sales have added up to 2.78m that has beaten 2011 and 2010 figures for the same eight months to August but falls short of the 2009 2.886m new home sales and is well below the 7.22m and 4.37m new home sales in 2007 and 2008 respectively. The change in the pending home sales figures highlights the volatility in the housing market as it measures the change in the number of homes under contract to be sold markets are expecting this to fall this current release.
Whether one believes that the housing market is in a recovery or not there is enough free money out in the system with interest rates being held low at least until 2015 that can help simulate parts of this heavily beaten up market but no question there still lies some rocky roads before the US home owners can really ring the bell, but no question from a technical stand point the markets are definitely starting to give a “foundation” to build a recovery.
According to reports by the Mortgage Bankers Association delinquency rate for mortgage loans has risen slightly but will be the barometer to watch to understand if the recovery is sustainable. Should the slowdown in the economy and Europe continue to pressure growth then this too has the potential to impact this recovery that looks to be underway.
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