Home Sales Strong Prices Hit New Peak!

La Jolla,CA—-Southern California home sales remained at near- record levels last month as prices continued their climb to new heights, the result of continued demand and the expectation that mortgage interest rates will continue to increase, a real estate information service reported.

Last Week in the News – Economic Update!

Defying Wall Street expectations for a slowdown, housing starts rose 5.3% in November, the Commerce Department reported December 20. Single-family housing starts increased 4.8% for the month to an annual rate of 1.8 million units, while groundbreaking on multifamily units jumped 7.9% to a pace of 315,000 units. Construction rose throughout the country, except in the South, with the West posting its fastest rate of growth in almost 27 years.

In addition, permits for future housing construction, an indicator of builders’ confidence, shot up 2.5% in November to an annual pace of 2.2 million units. Economists expected permits to fall to a 2.1 million-unit pace. Meanwhile, borrowing costs on 30-year mortgages fell for a second straight week.

The Producer Price Index, a gauge of farm, factory and refinery prices, fell a larger-than-expected 0.7% in November, the biggest drop in more than two years, the Labor Department said December 20. The PPI decline, coupled with last week’s report showing the biggest decrease in consumer prices since July 1949, could help ease inflation concerns.

In its final estimate of economic growth for the July-September quarter, the Commerce Department said December 21 that the gross domestic product — total output within U.S. borders — grew at a slightly less robust annual rate of 4.1% than the 4.3% reported a month ago. Nonetheless, the revised rate is better than the second quarter’s 3.3% rate and first quarter’s 3.8%.

This week, look for updates on existing home sales on
December 29.