Tag: housing market (Page 1 of 2)

      Home Depot cites ‘frozen housing market conditions’

      September 3, 2026 /

      Home Depot an alarming earnings report where they cited “frozen housing market conditions.”

      The video above puts this in the context of the slowdown in the US housing market. THome Depot’s CFO explained that the company is doing well as it takes market share, but that U.S. same-store sales grew only 1.3% year-over-year (roughly –2.5% after inflation). Store visits contracted. This reflects weak homebuyer demand, which hurts sales of appliances, flooring, countertops, landscaping, etc.

      There’s a real risk here to the economy. Housing represents roughly 15% of U.S. GDP. Prolonged weakness could spill into broader consumer spending (already showing a notable July retail drop) and eventually pressure the wider economy/stock market, which has so far been supported by consumer spending (often on credit amid low savings).

      Meanwhile, the Trump Administration seems hell bent on making things worse. Between the Iran war and the latest trade war with Canada, they seem to be clueless.

      Economy, Real Estate

      Some signs point to an improving economy

      August 10, 2012 /

      Things were starting to look pretty grim earlier this summer as job growth slowed and manufacturing activity slowed down, but now we’re starting to see some signs of life in the economy.

      After a spring and summer of weak economic indicators, a flurry of fresh data suggest key sectors of the economy might be gaining traction, just as the battle for the White House enters the final round.

      The long-moribund housing market has bustled to life, with prices and new-home construction rising in recent weeks. Hiring, so weak earlier this year, picked up last month. And on Thursday, the government reported an acceleration of a downward trend in the number of people seeking unemployment insurance, as well as a sharp improvement in U.S. exports.

      The housing news is key, as we were never going to have significant GDP or job growth without reaching a bottom in the housing market as Warren Buffett explained many times.

      Economy, Real Estate

      Housing starts surge

      December 20, 2011 /

      There’s a ton of demand out there for apartments as many Americans turn to renting as opposed to buying homes. With this demand, more apartments will be built and that’s having an effect on housing starts.

      U.S. housing starts surged to a 1-1/2 year high in November and permits for future construction were the highest since March 2010 as demand for rental apartments rose, offering hope for the weak housing market.

      The Commerce Department said on Tuesday housing starts jumped 9.3 percent to a seasonally adjusted annual rate of 685,000 units, the highest since April last year.

      October’s starts were revised down to a 627,000-unit pace from a previously reported 628,000 unit rate.
      ****
      Building permits, a gauge of future construction, rose by 5.7 percent. The increase was spurred by more apartment permits.

      New homes have an outsize impact on the economy. Each home built creates three jobs for a year and $90,000 in taxes, according to the National Association of Home Builders.

      Although the overall housing market remains weak, rising demand for rental apartments is boosting the construction of multifamily homes.

      Falling house values and stringent lending practises by banks are pushing Americans away from homeownership.

      The rate is still below the rate needed for a healthy economy, but the trend is in the right direction.

      It will be interesting to see how this trend plays out, and it offer business opportunities for people who can exploit these trends. The buying vs renting debate on real estate is definitely tilted now towards renting with the tight bank lending practices.

      Economy, Real Estate

      A double-dip recession in the housing market?

      May 15, 2011 /

      Things keep getting worse in the housing market as foreclosures glut the market and depress prices. It’s so bad that some are calling it a double-dip recession in the housing market.

      If the numbers showing housing prices slumming it around their spring 2009 lows aren’t troubling enough, then the surrounding context certainly is. The federal government spent trillions of dollars lifting housing — the recession’s great instigator — out of its trough. And now that home prices have collapsed again, the feds have far fewer tools available to prop them up again.

      This does not bode well for the entire economy, but it just shows how long it’s going to take to work through all the excesses of the mortgage bubble. In Las Vegas, the foreclosures are now spreading to upscale homes as well, giving high rollers the opportunity to come in and scoop up real estate gems on the cheap.

      Fortunately, there is one silver lining, as young people now actually have hope of getting an affordable home if they have decent income. With all the bad news out there for young people in the job market, at least there’s some good news. Unfortunately, many people are paying the price for the excesses of the past decade.

      Economy, Real Estate

      Mortgage rates keep falling

      August 19, 2010 /

      How low can home mortgage rates go? They keep falling.

      The interest rate for a 30-year mortgage fell for the eighth time in nine weeks, according to a widely watched survey, with the record lows triggering the highest volume of home refinancing in 15 months.

      Freddie Mac’s weekly report on lenders said solid borrowers with 20% down payments or home equity were being offered 30-year fixed-rate loans at an average of 4.42% this week, down from 4.44% a week earlier. The borrowers would have paid 0.6% of the loan amount in upfront lender fees.

      The average 30-year interest rate recorded by the survey has not risen in nine weeks, although it remained flat at 4.57% for the weeks ending July 8 and July 15.

      One reason is the terrible housing market. Homeowner confidence in the real estate market has dipped again.

      Homeowners(i) are more pessimistic about the short-term future of home values in their local market than they have been in the past three quarters, according to the Zillow second quarter Homeowner Confidence Survey(ii). One-third (33 percent) believe home values in their local housing market have not yet reached a bottom, while 38 percent believe they have already reached a bottom.

      Clearly, the foreclosure crisis has a long way to go.

      Economy, Personal Finance, Real Estate

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