I am pleased to present the first in a series of posts based on a report by Keller Williams:

This month offers a lot of encouraging news for the U.S. housing market.  Home sales have now shown a steady increase for four consecutive months.

Housing inventory has decreased and home prices have edged up compared to last month.

Many economists still cite a recovery in real estate as key to economic stability—bringing more jobs, growth, higher income opportunities, and stronger, more stable tax revenues.

The banking sector looks to stand on firmer footing as institutions begin repaying TARP funds. Yet the credit market remains tight, which presents challenges for mortgage applicants. Any sustained rebound will likely be tied to better credit availability for aspiring home buyers.

Consumer spending has slowed as consumers readjust their personal balance sheets and increase their savings.  And in the past month the U.S. savings rate has actually moved above the Canadian rate.

While their saved money is not directly benefitting the economy today, restored financial health will improve conditions for sustainable spending in the future.

Given firmer stability in the housing and financials sectors as well as a shift to consumer saving, the overall economy appears to be on a slow track to improvement. While any signs of progress must be weighed against the potential road bumps ahead, sustained economic recovery over the next year is expected to come in piecemeal fashion.

Some uncertainty factors include unemployment numbers, rising mortgage rates, and new appraisal rules.

Check back for the next installment in this series: The Numbers That Drive Real Estate: Home Sales.

Jennifer Mackay
850-774-6582
www.jennifermackay.com

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