By Tony Stevenson/SWBC Mortgage
Economic News Week: January 17, 2011
The DOW rose to its highest level in 2 1/2 years closing at 11787 this past Friday. This is yet another indicator that stocks are on the rebound. The Federal Reserves survey of economic conditions (The Beige Book) reported that the U.S. economy ended on a positive note, with all parts of the country showing improvement. It was reported also last week that the housing market could gradually begin to emerge from its doldrums this year, industry experts said but, their forecast depends on a steady ramp up in hiring. Retail Sales rose in December for the 6th straight time to .08%. A report from the New York Times said that as Republicans choreograph a House vote to repeal The Health Care Bill this week, no change has stung Democrats more than the argument that the new law will "kill" jobs in a economy wobbling back to life. In the fight over whether the law will create or destroy jobs, both political parties cite evidence to support their claims. But many economists say the effect on jobs is likely to be modest: neither so negative as Republicans assert nor so positive the Democrats contend.
Local Economic News
The San Antonio area will see a job surge of 27,300 jobs in 2011, for an above average gain of 3.2 percent, Keith Phillips of the Federal Reserve-senior economist based in San Antonio predicted last week. Another report said last week that a "consensus is building" San Antonio will jump from a below-average year in job growth for 2010 to an above average year in 2011. This week-Friday the Texas Work Commission will release December's unemployment rate for San Antonio and other cities of the State. Plus, SABOR (San Antonio Board of Realtors) will release its December and year-end 2010 home sales data. Don't expect positive numbers in either case. But, instead look for the positive numbers in 2011. Especially after an estimated 27,300 jobs are created and folks are out spending and looking for a home. 2011 is the year for growth.
Real Estate and Mortgage Industry News
As I said above, with the job growth San Antonio expects for 2011-this will surely create an atmosphere of anticipation that when folks are working, folks are spending money. I would also think that with that many jobs, some will be out buying a home. Some San Antonio and surrounding Hill Country Realtors I have talked to have said that their business has picked up for January. Their phones are ringing more and appointment showings have increased. On the Mortgage rate front: Freddie Mac reported that mortgage rates on the 30 year fixed index dropped slightly to 4.71% last week from 4.77%. As a reminder, when Mortgage rates go up, the tend to rise quickly and vice versa. If you are thinking of buying a home this year, please seek the advice of a local Realtor and Mortgage Loan Officer. Home prices are very reasonable in most areas and mortgage rates are still at historically low levels. Keep in mind too, that when the $8k tax credit was available, home prices were higher. Now, that there is no tax credit, home prices are even lower saving you more than $8k in most cases.
Economic Data due this week: Monday: Markets closed. Wednesday: Building Permits and Housing Starts Report. Thursday: Weekly Jobless Claims. Thursday: Philly Fed Index= A manufacturing survey. Thursday: Existing Home Sales Report.