Prescott Real Estate News Blog's purpose is to keep current, past, and potential clients apprised of the real estate market conditions for the Prescott, Arizona Area. National and state news and events will be posted but special emphasis will be placed on Prescott Area and the Yavapai County - Prescott, Prescott Valley, Chino Valley, Dewey and Kirkland/Skull Valley.
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Economic Highlights for the Week Ending September 25, 2009
MONDAY, September 21st
The index of leading economic indicators rose for the fifth straight month in August, gaining 0.6%. The gain was led a jump in stock prices, higher consumer expectations and an increase in building permit issuance. Weakness remains in jobless claims and equipment orders. The index has surged over the last six months or so indicative of moderate economic expansion over the next six to nine months.
TUESDAY, September 22nd
The FHFA purchase-only house price index increased 0.3% from June to July but remains 4.8% lower than in July 2008. The monthly gain in the index is encouraging and could signal the worst of the house price declines are over; however prices may not have bottomed yet, so declines could continue but may not be as severe.
WEDNESDAY, September 23rd
The MBA mortgage applications index increased 12.8% to 668.5% for the week ending September 18. The purchase index was up 5.6% on the week but declined 15.8% from last year. The refinance index gained 17.4% on a weekly basis and is up 41.0% from a year ago. Refinance activity accounted for 63% to total applications last week. Despite recent volatility, application activity is trending higher which is consistent with a modest recovery in the housing market.
The FOMC decided to keep rates in an exceptionally low range of 0% to 0.25% in order to support ongoing recovery in the economy at the conclusion of their two-day policy meeting today. The Committee acknowledged a pickup in economic activity, specifically in the housing sector but expected overall conditions to remain weak for a while longer. Inflation remained subdued since last meeting, thus it was not a major concern for the Fed at this time. Policymakers did start to outline their strategy for unwinding liquidity measures taken in response to financial and credit market crisis in the past year. It looks as though their purchase of Treasury securities will wrap up by the end of the month, as planned while MBS and agency purchases will conclude by the end of the first quarter.
THURSDAY, September 24th
Jobless claims fell 21k to 530k for the week ending September 19. Continuing claims also declined, falling by 123k to 6.138 million for the week ending September 12. These data indicate continued improvement in labor market conditions however movement remains slow. The economy continues to shed jobs but at a less alarming rate than in previous months.
Existing home sales fell 2.7% in August to an annualized pace of 5.10 million. Market expectations were centered on a gain to a rate of 5.35 million. The unexpected pullback last month does not alter the modestly rising trend over the last several months from extremely low levels earlier this year. Over the past year, existing home sales have increased by 3.4%, only the second yearly gain since November 2005. However, existing home sales remain 29.7% lower than their September 2005 record high. It was estimated that about 31% of total sales were distressed sales and about 30% were from first-time home buyers.
FRIDAY, September 25th
Durable goods orders sank 2.4% in August led by weak demand for civilian aircraft. The decline last month partially offsets a 4.8% gain in July. Recovery in the manufacturing sector is happening at an uneven pace. Declines at this stage are not out of the ordinary and are coming from the highly volatile transportation sector. Excluding transportation orders demand for big ticket items was unchanged from July.
New home sales rose 0.7% in August to an annual rate of 429k after a downwardly revised rate of 426k in July. Expectations were centered on an annual rate of 440k; despite missing the mark new home sales continue to trend modestly higher from a record low rate of 329k in January. Recovery continues in the housing sector, boosted by the fist-time buyer tax credit, low rates and falling prices, however gains remain mild and are not far from very depressed levels. Progress will continue to be slow and could possibly backslide a bit in coming months.
Stock Market Close for the Week
A Week Ago
-155.01 or -1.58%
-41.94 or -1.97%
WEEK IN ADVANCE
Lots of data on tap in the coming week, chief among the reports is the employment situation for September due out on Friday. The employment report always has great weight and sway but especially now that the overall recovery hangs in the balance.
Key Interest Rates
6 Mos Ago
1 Yr Ago
11th District COF
30-Year Treasury Bond
30-Yr Fixed (FHLMC)
15-Yr Fixed (FHLMC)
1-Yr Adj (FHLMC)
6-Mo Libor (FNMA)
Sources: IBC' s Money Fund Report; Bank Rate Monitor; Federal Home Loan Bank of San Francisco
Upward pressure on interest rates Downward pressure on interest rates No pressure to change interest rates News worthy