By Tony Stevenson/SWBC Mortgage
Economic News Week: October 17, 2011
In less than two weeks, U.S. stocks have staged a remarkable recovery that saw some major indexes climb from the depths of near-market despair to positive territory for the year. The DOW climbed this past Friday 166.36 points or 1.45% to 11644, taking its gains since early last week to 12%. It is also now up 0.58% for the year. The recent gains were attributed to progress that the European debt crisis seems to be coming to a resolution. Plus, the U.S. positive economic data played a part as well.--All this in the Wall Street Journal’s weekend edition. Google reported way better than expected gains as Q3 earnings continue this week.
Confidence among U.S. small companies rose in September from a 13 month low, a private survey found. The National Federation of Independent Business’ index climbed to 88.9%, the first gain in seven months. The U.S. Retail Sales Report rose 1.1% for September, the biggest jump since February. The weekly jobless report fell slightly again last week. All of this is good news regarding our economy. I really haven’t seen much of any so called “bad” economic news this past week. Except from what I hear form certain political candidates.
Local Economic News
The Eagle Ford Shale continues to make the news in Texas as the windfall of oil and gas leases in Texas are gaining momentum. A huge economic boom for our state and South Texas continues. Texas Railroad Commission Chairwoman Elizabeth Jones extolled the economic benefits of drilling in the Eagle Ford Shale Wednesday saying its production is adding significantly to state coffers. Certain problems still exist regarding employment issues as there seems to be a shortage of truck drivers. If you know of anyone looking for a job, now could be the best time in years to find gainful employment. The income from these jobs is not too shabby either.
Real Estate and Mortgage Industry News
In a report in last week’s S.A. Express News, the article stated that the median price of a home in the San Antonio area is up, but the number of sales were down only slightly. Foreclosure postings were flat compared with the same month last year. The median home price for Bexar County for 2011 is $152,500 compared to $149,500 for the same month last year as well. SmartMoney.com columnist, Jack Hough wrote, “Houses aren’t the magic wealth creators they were made out to be during the bubble. But when prices are low, loans are cheap , and plump investment yields are scarce, buyers should jump.” So, is it cheaper to buy than rent? Mr. Hough uses this example in Phoenix , Az.: A median home price of $121,700 with a 20% down payment and a 4.124% mortgage rate, a buyer’s monthly payment would be about $470. Rent for a comparable house would be more than $1,100 a month, according to data provided by Zillow.com.
FHA new-revised loan limits are as follows for these counties: Bexar and Kendall Counties= $287,500 (revised from $332,500. Bandera, Blanco, Gillespie, and Kerr counties remain at= $271,050.
Finally, Freddie Mac reported that the 30 year fixed rate rose sharply to 4.12% this past week. Does this mean you should run to your local Real Estate agent and find the home of your dreams before rates or home prices rise further? I would have to say, yes. And for good reason-not only could rates go higher, but lending standards could tighten up further as well. Making it even harder to qualify for a home loan. But, keep this in mind: If you have good credit, a good job, good income, and a good down payment, you will qualify for a home loan. Even if you have a few “credit challenges”, find a local Realtor and Mortgage Lender to see how much you may qualify for. There is No-Cost to get pre-qualified. Then you can begin the house-hunt. Which reminds me, Whitetail deer hunting season begins soon. Another economic booster for the Texas Hill Country and South Texas!
Economic Data due this week: Q3 earnings still arrive this week-such as Wells Fargo and Citi Group Inc. Tuesday: PPI (Producer Price Index)=prices at the wholesale level. Wednesday: CPI (Consumer Price Index) prices paid by consumers at the retail level. Wednesday: Housing Starts. Wednesday: Beige Book= Fed report examining economic conditions in a variety of sectors across the country. Thursday: Weekly Jobless claims. Thursday: Freddie Mac released weekly mortgage rates. Thursday: Existing Home Sales Report for September.
Quote of the week!
Here’s your “whether” report:
Whether you do or you don’t is your choice.
But remember there are consequences for
those choices.
----A.W. Stevenson