House sales in online news & the economy

New Home Sales in US Post Surprise Jump in October

economy online news

New home sales in the US defied expectations and rose in October, government data showed Wednesday, despite mortgage rates remaining high. online news

Although sales surged during the pandemic, the sector cooled with the central bank raising the benchmark lending rate multiple times this year to ease demand and tamp down soaring inflation.

But sales of new single-family houses picked up 7.5 percent to a seasonally adjusted annual rate of 632,000 in October, said the Commerce Department, despite analyst expectations of a dip as higher rates bite.

The median sales price for a new home in October rose to $493,000 as well, up from September’s revised figure of $455,700.

Monthly data can be volatile, and some observers have pointed to a rush to lock in mortgage deals before rates increased further as a reason that sales surged previously.

Online News World News International News
Fernando

Another factor analysts have cited is a lack of existing inventory, nudging buyers into the market for new property, supporting sales.

In October, the sales pace remained below that of the same period in 2021.

The latest figures come as the US’s much bigger existing home sales market slipped for a record nine consecutive months.

“The increase in sales came despite a rise in new home prices,” said Nancy Vanden Houten of Oxford Economics in an analysis.

But she noted that this reflected a shift in composition of sales, towards homes priced above the median.

“We expect sales to remain under pressure going forward as the erosion in affordability this year keeps many buyers on the sidelines,” she said.

Home sales have eased “sharply” overall, added economist Rubeela Farooqi of High Frequency Economics.

“Pressure is likely to persist in the near term as low inventories, still-high prices and elevated mortgage rates weigh on activity,” she added in an analysis.

bys/tjj

© Agence France-Presse. All rights are reserved.

economy online news

Notes from APS Radio

During the past few years, a number of the world’s central banks have engaged in massive programs of monetary expansion, even as jobs and businesses were lost by way of virus-related restrictions and quarantines. online news

For example, beginning in March of 2020, the US Federal Reserve engaged in a substantially greater program of monetary expansion by purchasing hundreds of billions of dollars of Treasury and corporate bonds.

Since the early part of March 2020 to date, the Federal Reserve has added over $4 trillion to its holdings.

In particular, whereas on or about February 24, 2020, the holdings of the Federal Reserve stood at $4.2 trillion, on or about January 17, 2022, the holdings of the Federal Reserve stood at about $8.9 trillion.

As well, the Federal Reserve has kept interest rates low.

Recently, Jerome Powell, the head of the Federal Reserve, said that he wasn’t concerned about inflation and that, for the none, the Federal Reserve would keep interest rates at low levels.

Another examples is that of the Bank of Japan.

According to Fred Economic Data, as of October 2021, the Bank of Japan’s holdings were about $6.4 trillion or about 725 trillion Yen.

In the early part of March 2020, the Bank of Japan’s holdings were $5.3 holdings. During the period mentioned, the Bank of Japan added over one trillion dollars to its holdings.

A number of corporations have been borrowing money inexpensively and have been purchasing their own shares of stocks, increasing share prices of stocks.

Still, there are concerns among investors.

A number of them have expressed concerns about central banks’ eventually increasing interest rates, as, during the past year, inflation levels have been increasing.

The combination of low interest rates, expansive monetary policies, fiscal stimulus programs, which themselves have infused trillions into the US economy, and shortages of goods and services caused by virus-related restrictions and lockdowns has increased levels of inflation.

Investors also have worried, for example, about announcements that were made by companies like Toyota and VW; months ago, those companies announced that because of shortages of particular types of material, they would be reducing levels of production.

Months ago, the results of a survey of UK manufacturers were released.

That survey indicated that many businesses in the UK were concerned about shortages of supplies.

In general, jobs and businesses have been lost by way of mandates, restrictions and quarantines, which, in their turn, were imposed by way of the virus narrative.

In the US, overall, the mortality rate of the virus is about .069%, according Statista, an award-winning service.

The recovery rate is over 99% for most age groups.

What has followed in the wake of lockdowns and mandates has been the infusion of trillions of dollars into the US economy, the increasing succeess of online businesses like Amazon and other large online retailers, various bank and tech-related stocks, the shuttering of small to medium-sized businesses and the loss of millions of jobs.

Another result has been the increasing levels of inflation, especially those of food and fuel.

In official terms, for purposes of reporting, the US Labor Department uses what is called “core inflation”.

Core inflation excludes items like food and fuel, as those are deemed too volatile.

economy online news

Commentary & News Online
APS Radio News