QUOTE OF THE WEEK… “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel”–Maya Angelou, American author and poet
INFO THAT HITS US WHERE WE LIVE… People who are putting their homes on the market appear to be feeling pretty good these days. An online real estate portal reports that the asking prices of homes listed with them were up 5.9% in January from a year ago, in 86 of the 100 largest metros. Those asking prices grew by a seasonally adjusted 0.9% from December, the largest month-over-month boost since March last year.
Housing experts are feeling pretty good too. The chairman of the S&P Dow Jones index committee said, “housing is clearly recovering,” citing November’s healthy new and existing homes sales. The National Association of Realtors chief economist predicted, “Job creation and household formation will likely fuel growth. Both sales and prices will again be higher in 2013.” (CORRECTION: A keen Inside Lending reader pointed out Ayn Rand’s first name was misspelled following her quote in last week’s edition. We’re sorry for the typo and apologize to Rand fans.)
BUSINESS TIP OF THE WEEK… Don’t get sidetracked before you reach your goal. When you’re stuck, going out for a walk is a great way to clear your mind and get back on track.
>> Review of Last Week
ONE DOWN, TWO UP… The Dow had a seesaw 5 days–down 130, up 99, up 7, down 42, up 49–to end the week down a mere 0.1%, just below last week’s 14,000 threshold. But the S&P 500 headed north and is now up for the first six weeks of the new year, which has not happened since 1971! The Nasdaq also registered a gain, making another healthy start to the year. Friday, investors were buoyed as the U.S. trade deficit came in down almost 21% in December, its biggest drop in four years, thanks to rising exports and a decline in imports.
Earlier in the week, the ISM Services index was down for January but showed expansion for the 37th month in a row. Best of all, the ISM Services employment sub-index rose again, hitting its best reading since February 2006. Employment expansion is especially good for the economy in the services sector, since it provides well over 80% of U.S. jobs. On the down side, Productivity fell at a 2% annual rate in Q4, not too cool. But new weekly jobless claims were down by 5,000, to 366,000, another sign of labor market improvement.
The week ended with the Dow down 0.1%, to 13993; the S&P 500 UP 0.3%, to 1518; and the Nasdaq UP 0.5%, to 3194.
The light amount of economic data with its mixed messages kept buying steady in the bond market, Treasuries posting their first weekly gain in the last three. The FNMA 3.5% bond we watch ended the week up .01, at $105.13. National average mortgage rates, after edging up recently, settled back down in Freddie Mac’s Weekly Survey. Not surprisingly, weekly demand for purchase loans was UP 16% from a year ago, to its highest level since May 2010, according to the Mortgage Bankers Association.
DID YOU KNOW?… January was the first time since last spring that asking rents showed a smaller year-over-year increase (up 4.1%), than asking home prices (up 5.9%).