Here’s the highlights of the Nations economic and financial news for the past week (September 23rd – 28th), as it may effect the local real estate markets here in orange County, CA.

National Home sales down again:

A busy week of economic reports brought mixed news, shaded to the negative side. Both new- and existing-home sales fell in August, and consumers felt less confident than earlier in the summer. Durable-goods orders experienced their biggest drop of the year in August. On a positive note, gross domestic product for the second quarter held steady, personal income rose slightly, and a key inflation figure fell for the first time in nearly a year. For the week, the S&P 500 Index rose 0.1% to 1,527 (and has earned a year-to-date return of 9.8%). The yield of the 10-year U.S. Treasury note fell 6 basis points to 4.57%. 

National Housing market woes continue:

Existing-home sales continued their slide, falling 4.3% in August to an annualized 5.50 million units. The decline was within expectations, however, and house prices appeared to be stabilizing. Sales were slower across the country, with the market overall moving at its slowest pace in five years. The supply of existing homes continued to grow, reaching 10 months of inventory in August, well above the 7.3 months of inventory from a year ago. Condominium sales decelerated at a faster pace than single-family home sales. New-home sales were also at a crawl in August, falling 8.3% to 795,000 annualized units. The sales pace is the slowest in nearly 10 years and was below already gloomy expectations. The West and South regions were hit hardest, experiencing significant declines, while the Northeast and Midwest actually saw large gains in sales. The median price for a new home fell 7.5% from its reading a year ago. Unfortunately, the same trend was true in Orange County, with number of homes sales slightly decreasing from the previous week, continuing the trend for several months.

Consumer confidence remains shaky:

Stock market turbulence and a weaker jobs market had consumers feeling less confident for the second consecutive month. The Conference Board’s Index of Consumer Confidence fell to 99.8 in September, after achieving a post-9/11 high as recently as July. All index components were lower, making September’s figure the lowest reading in nearly two years. Higher percentages of consumers viewed jobs as being less plentiful and harder to get than at any time since November 2006.

Nonresidential construction boosts spending:

August construction spending rose 0.2%, above expectations of a downturn. Private construction was flat, despite a 1.5% drop-off in residential construction. Nonresidential construction climbed 1.6% for the month. Hotel, office, and commercial building projects all showed solid gains.

Second-quarter GDP holds steady:

The final estimate of real gross domestic product (GDP) for the second quarter measured a 3.8% annual rate, within expectations. Homebuilding sliced more than half a percentage point from overall growth during the period, and consumer spending was down significantly from the first quarter as well. Corporate profits, on the other hand, climbed to a record high and increased their share of GDP overall.

Demand for durable goods falls:

Orders for durable goods, manufactured items expected to last more than a year, plunged 4.9% in August, their largest drop since the beginning of the year. The decline was far greater than expectations and came on the heels of a solid 6.1% gain in July. Nearly all manufacturers took fewer orders during the month, with civilian aircraft demand registering the largest drop-off. Excluding transportation, orders were off 1.8% from July.

Personal income Nationwide posts slight gain:

Strong income from investments boosted personal income 0.3% in August, within expectations. Wages and salaries rose a modest 0.2%, dwarfed by 1% growth in dividend income, which has been strong throughout the year. Personal spending rose 0.6% for the month, largely on the strength of automobile sales, while the saving rate decelerated to 0.7%. The consumer spending deflator, a measure of inflation closely watched by the Federal Reserve, eased 0.1% in August, its first dip in nearly a year.

If you have any questions regarding mortgage loans for the purchase or refinance of real estate in Orange County, CA., or if you would like a second quote on a Mortgage loan with very low interest rates and low costs, please feel free to call us at:  949-388-3396 or drop us an email at: Info@SearchOCHomes.com