The Fed Meets While Jobs Report LoomsPolitical conventions, Brexit, terrorist attacks and more. Could we have anything else happening in the markets while the Federal Reserve Board’s Open Market Committee met on the future direction of interest rates? Being on that committee is a tough enough job as it is, but this year the factors influencing the world’s economies are just tremendous. Few were expecting the Fed to raise interest rates this month, but before we start thinking about the next meeting in late September, we must remember that there is a Presidential election coming up.
What does this have to do with the Fed? With only approximately six weeks between the next Fed meeting and the election, any move to take action or make any strong statements could be seen as a move which might affect the results of the election. Not that the Fed is all-powerful, but the Fed’s statements and actions affect the markets and the markets’ performance affects how voters feel. Therefore, it would be surprising if the Fed raised rates or gave a date for such at the next meeting. Surprising, but not out of the question.
Speaking of factors, another such factor coming up this week is the jobs report for July. Lately, the jobs numbers have been more volatile, with a very weak report for May and a very strong report for June. Every month the jobs report is analyzed with a microscope by the markets and July’s numbers will be no different in this regard. If the report is very strong, it will be harder for the Fed to hold off on a rate increase in September, regardless of the upcoming elections.
Millions of Americans lost their homes to foreclosures or short sales during the housing crisis. Fortunately for the economy, time heals most wounds — and credit reports. The number of people joining the rolls of those knocked from homeownership peaked seven years ago, so those blotches to their histories are starting to roll off the books right about now. The resulting improvement in credit means more Americans will find themselves with the ability and means to once again apply for loans, and not just for home purchases. The number of consumers with a new foreclosure added to their credit reports peaked at about 566,000 in the second quarter of 2009, according to data from the Federal Reserve Bank of New York. In the four years through 2010, that group totaled 6.8 million. Negative events such as short sales, when a home is sold for less than what’s owed on it, and foreclosures generally roll off a person’s credit report after seven years, according to the three major providers of consumer credit scores and reports: Experian Plc, Equifax Inc. and TransUnion. With that anniversary fast approaching, better access to credit may be on the way for many. The obvious effect will be in stronger demand for homes, which may also translate into higher spending on durable goods such as appliances and furnishings, said Oubina. Consumers may also feel more comfortable applying for new credit cards, auto loans or other types of debt. The credit repair alone could help people improve their financial standing by reducing their borrowing costs, freeing up money that could then be used for consumption. Source: Bloomberg Want a reading on your or your client’s status regarding where they stand with regard to purchasing again? Contact us for an assessment.First-time home buyers flooded the market recently, reaching their greatest share in nearly four years, according to NAR’s latest housing report. Existing-home sales climbed across the country in June as the summer continued to see high demand. Existing-home sales rose 1.1 percent to a seasonally adjusted annual rate of 5.57 million in June, NAR reported. Sales are now up 3 percent compared to a year ago and are at the highest annual pace since February 2007. First-time buyers comprised 33 percent of the market last month, the highest level since July 2012 (34 percent at the time), NAR reports. “The bump in June sales to first-time buyers can be attributed to interest rates near all-time lows and perhaps a hopeful indication that more affordable, lower-priced homes are beginning to make their way onto the market,” says Yun. In addition, median-existing-home prices for all housing types in June was $247,700, increasing 4.8 percent from a year ago and unsold inventory is at a 4.6-month supply at the current sales pace, down from 4.7-months in May. Source: National Association of Realtors®
SAM is a bricklayer who never takes a day off, doesn’t call in sick, never checks his cellphone and doesn’t even take a coffee break. Some would say that’s inhuman, and they’d be right. SAM — Semi-Automated Mason, that is — is a robot. Once he’s programmed by his handlers, he takes off, laying brick after brick after brick without saying a word. He can lay 1,000 bricks an hour and finish the typical two-story house in two days. Created by engineers in Perth, Australia, SAM auto-corrects 1,000 times per second to prevent interference from sway and vibrations. Slapping mortar on the bricks and then putting them in place — the exact opposite of the way humans do brickwork — the machine is 20 times faster than a journeyman mason. Some people don’t think the robotic bricklayer will ever catch on in the real world of residential construction. They may be right. But there’s no doubt that robotics will one day be commonplace — if not to help erect the house, then inside the house to help simplify its inhabitants’ lives. How about big, strong robotic helicopters, hoisting roof joists or wall sections into place? And there are already driverless cars, so why not driverless construction vehicles? Then there’s the giant 3-D robot printer created by a University of Southern California (USC) professor that can build a complete house in a single day. The robot can read an architect’s computer-aided design drawings and spit out exactly what the plans call for. USC’s Behrokh Khoshnevis, a professor of industrial and systems engineering, says his “Contour Crafting” robot can also build fast post-disaster housing for the displaced, military housing for our service members, inner-city and in-fill houses for people in need, and houses in developing countries. Source: Lou Sichelman, The Housing Scene