It wasn’t exactly huge news, but last week, the revised economic numbers showed improvement! When does that ever happen—when the final revisions come in, don’t they always seem to be in a downward direction? Yet Friday’s release from the Associated Press told a different story. Earlier reports of a slowing U.S. economy had been revised to show a year whose beginning “wasn’t quite as bad as first thought.” The reason was housing—which “got a bigger boost” than first reported.
This is all to suggest that the wider economic climate for local real estate—that is, for sellers and buyers midway through this year’s spring/summer selling season—is one that shows improvement (“slight improvement,” according to many—but we’ll take it). Fears of an economic stall seem to have vanished for the moment. Lacking was anything in the economic tidings that would suggest the Portland area’s real estate picture includes any storm clouds on (or even over) the horizon.
ITEM: Per the ABCNEWS site, economists are forecasting a rebound in the current quarter—to growth of around 2%. That was expected to improve as well: “In the second half of the year, economists are forecasting that growth will strengthen further to around 2.5%.”
ITEM: In what is now the seventh anniversary of economic expansion, Reuters reported that U.S. new homes sales had notched an 8-year high. “New U.S. single-family home sales recorded their biggest gain in 24 years in April…as purchases increased broadly.”
ITEM: Last Thursday, Mortgage News Daily reported mortgage rates the lowest in “more than a week.” For sharp-eyed northwest real estate watchers, this might have been puzzling, given that Freddie Mac had just announced that rate “rose rather sharply.” MND clarified the contradiction by explaining, “that’s to be expected given [Freddie Mac’s] report’s methodology…”
ITEM: U.S. News & World Report disagreed, siding with Freddie. But in a sunny sort of way: Mortgage rates “rose this week but remained at low levels that could entice purchasers amid the current home buying season.”
ITEM: Even if Freddie and U.S. News had been right, and home loan rates were on the rise, another respected real estate voice spoke up to suggest that even that could become good news for real estate. How so was elaborated in Yahoo! Finance’s interview with Toll Brothers Chairman Robert Toll, who turned most commonly held assumptions on their head:
“If the Fed goes up and the mortgage rates go up…it probably means price increases are coming soon, which spurs demand and spurs action.”
Summing up, it was, on balance, a quietly upbeat picture—one pointing to a future for local real estate clear of any rough patches in the immediate future. Given that there continue to be exceptional offerings in our market—and with home loan rates still being locked at terrific levels, for sure it’s an opportune time to give us a call!
Craig Reger Group
We sell more because we do more.