Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses personal income and consumer sentiment.
Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses jobless claims and the GDP.
As a five year old my elderly great-aunts told me that “A little learning is a dangerous thing”: being certain without all the facts can lead to the wrong conclusion. This was aptly illustrated by the sound bites accompanying the latest Case-Shiller Index release. The Index was reported as falling in January by 0.8% from its December reading and as down 3.8% from January 2011. The headlines announced that the housing market was off to a “rocky start” for the year as prices reached new lows. As a friend of mine used to say, “We gave them the facts—just not all the facts.” Put differently, the coverage was wrong, although the facts were presented in the Case-Shiller news release.
Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses mortgage purchase applications and durable goods.
OCC Reports Foreshadow Improved Supply Conditions
According to a report from the Office of the Comptroller of the Currency (OCC) on Wednesday, March 28th, short sales rose by more than 10% from the 3rd quarter of 2011 to the 4th quarter reaching a record of 63,257. The potential for more distressed properties, longer time in the costly foreclosure process, and heightened oversight has resulted in more interest on the part of banks, investors, and the GSEs in this alternative to foreclosure. The trend toward short sales is important as academic research suggests that a short sale has no impact on the sale prices of non-distressed homes in the same neighborhood, while REO sales can have a significant negative impact. The OCC’s figures only measure 1st lien loans though, so they may understate the true number of short sales by not incorporating sales where the selling price did not cover the 2nd lien or piggy-back loan.
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