January - March 2014
Housing Markets
By Urs Buehlmann
Several housing market indicators exhibited declines in January - this is not atypical for a winter month. A bright spot was "New" house sales - which, in future months, may be revised higher as private estimates recorded more sales than the reported United States DOC data. Construction spending data was also a positive indicator. As in previous months, the near-term outlook on the U.S. housing market remains unchanged - there are potentially several negative macro-factors or headwinds at this point in time for a robust housing recovery (based on historical long-term averages). Why?
- Lack-luster household formation,
- A lack of well-paying jobs being created,
- A sluggish economy,
- Declining real median annual household incomes,
- Strict home loan lending standards,
- New banking regulations, and
- Global uncertainty?