Monitor
Pending Home Sales
Pending home sales in November posted their highest level in 19 months. NAR’s Pending Home Sales Index registered 100.1 for the month – a 7.3% gain from October’s revised index of 93.3 and 5.9% ahead of the index in November 2010. All regions of the country showed month to month gains, and all but the Northeast posted gains from a year ago.
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Existing-home Sales
Existing-home sales rose 4.0% in November to a seasonal adjusted annual rate of 4.42 million units. Resales were 12.2% ahead of their pace a year ago and at their highest level in 10 months. All regions of the country experienced increased sales. The inventory of existing homes at the end of November declined to 2.58 million units – a 7.0 month supply at the current sales pace.
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New Home Sales
New home sales posted a seasonally adjusted annual rate of 315,000 units in November – a 1.6% increase from the previous month and 9.8% ahead of the sales rate in November of 2010. The supply of new homes available at the end of the month was 158,000, a 6.0 month supply at the current sales rate. The inventory of new homes has been trending downward consistently since July of 2011.
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Housing Starts
Housing starts also increased in November, rising 9.3% from the previous month to a seasonally adjusted annual rate of 685,000. Starts were 24.3% ahead of their pace a year ago. Multifamily starts continued to outpace single-family ones; in fact, multifamily starts were up more than 32% from October, and 180% from November 2010.
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Housing Affordability
Housing affordability remains at very high levels. NAR’s Housing Affordability Index posted a reading of 194.5 for November – down slightly from October’s level but well ahead of the 180.9 index of November 2010. The small decline was due primarily to a month-to-month increase in the price of an existing home, as well as a rise in qualifying income.
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Mortgage Rates
Mortgage rates reached a new low in November, as the average 30-year fixed rate came in at 3.96% for the month. Rates may not remain this low too long – NAR forecasts rates to gradually rise and reach 4.5% by the end of 2012 and 5.2% by the end of 2013.
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Employment
The U.S. economy created 200,000 nonfarm payroll jobs in December – a 15th straight month of job gains and the highest job creation figure since March of 2009. Private-sector employers added 212,000 payrolls. November’s job figure was revised downward, but October’s number was revised upward. The unemployment rate was 8.5%.
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Economic growth
The U.S. economy grew at an annual rate of 1.8% in the third quarter of 2011. This is the third estimate of real GDP growth based on more complete data. GDP growth posted 1.3% in the second quarter of last year. Consumer spending rose 1.7% in the third quarter, compared to 0.7% in the second. Spending on durable goods rose 5.7%. The figures support most analysts’ view that the economy is recovering but very slowly.
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