New U.S.
single-family home sales race to a 10-month high
New
U.S.
single-family home sales surged in December to their highest level in 10
months, the latest indication that the housing sector remains on a firmer
footing despite a massive stock market sell-off and slowing economic growth.
The
Commerce Department said on Wednesday sales rose 10.8 percent to a seasonally
adjusted annual rate of 544,000 units, the highest level since February 2015.
Sales last month were likely buoyed by unseasonably mild weather and a rise in
the supply of homes on the market, which increased choices for buyers.
New
home sales soared 14.5 percent in 2015, the highest level since 2007.
Economists had forecast new home sales, which account for about 9.1 percent of
the housing market, edging upward to 500,000 units.
In
another promising sign, a separate report from the Mortgage Bankers Association
showed applications for home purchase loans increased 8.8 percent last week
from a week earlier. Mortgage rates remain low by historical standards, even
after the Fed’s recent rate hike.
Many
national economists feel this is a promising sign for the housing market as we
move into 2016. They expect the strong increase in new home sales to continue
as the fundamentals in the housing market remain strong and new vintage homes
are in short supply.
A
firmer housing sector should put a floor under the economy, which has been
battered by the headwinds of a strong dollar, spending cuts by energy firms
stung by lower oil prices and sluggish global demand. Efforts by businesses to
whittle down an inventory bloat have also been a drag on growth.
This
month’s stock market sell-off, which has seen a more than 7-percent plunge in
the Standard & Poor’s 500 index, is also adding to the pain. But with
housing boosting household wealth, the drag on consumer spending from falling stock
market values could be minimal.
The
government is expected to report that fourth-quarter gross domestic product
increased at a 0.8 percent annual rate, according to a Reuters Survey of
economists, slowing sharply from the third quarter’s 2 percent.
In
December, new home sales jumped 20.8 percent in the Northeast and gained 0.4
percent in the populous South. They advanced 31.6 percent in the Midwest and shot up 21.0 percent here in the West.
With
new home developers and builders constructing beautiful new homes here in Visalia, Tulare and Porterville, now is the
time to contact your favorite lender and get prequalified to purchase the home
of your dreams. Wouldn’t that make a nice Valentine’s Day gift for the family?
Jeremy Engle
Country Club Mortgage
559.734.5000 Central Valley Phone 805.544.2775 Central Coast Phone Email: jeremy@jeremyengle.com
400 E. Main St. Suite 120 Visalia, CA 93291 6795 N. Palm, Suite 101 Fresno CA 93711 4211 Spring Tree Ln. Bakersfield CA 93314 1204 Nipomo St. San Luis Obispo CA 93401 888.330.2272 fax NMLS # 293517 | DRE # 01474957 Apply online 24/7 @ www.jeremyengle.com
