Monthly Archives: November 2011

October New Home Sales

Posted on by

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

INDICATOR: October New Home Sales
KEY DATA: Sales: +1.3%; Median Prices (Sept-Oct): -0.5%; Prices (Oct ’10-Oct ’11)): +4.0%

IN A NUTSHELL: “The new home market remains in the doldrums.”

WHAT IT MEANS: Yes, new home sales rose in October but that is about all you can say about this report. First, the level of demand is miniscule. Think about it, only 25,000 newly constructed houses are being are being purchased each month. Second, the September sales rate was revised downward, not a trend you like to see. At least there were a couple areas around the country, the Midwest and West, where builders did see a strong pick-up in sales. But the Northeast was flat and there was a sharp decline in the South. Total sales for the first ten months of the year are down nearly 7% compared to 2010 levels. As for prices, they eased a touch over the month but were up quite nicely when compared a year ago. Builders are competing with distressed houses so they have to keep prices quite low. Builders continue to do a good job of controlling inventories so demand and supply are being kept relatively in balance.

MARKETS AND FED POLICY IMPLICATIONS: Housing has been adding a little to growth this year and that is likely to continue. But the operative word in that sentence is “little”. The huge bump in jobs, income and GDP that we usually get from a rebounding housing market is not likely to be seen for quite a long time so don’t expect overall growth to be great over the next year. Still, there really is no place to go but up so we can also count on housing to be a positive not a negative in the overall scheme of things. As for the markets, the story is the consumer and the apparently robust increase in sales during the “Black Friday” weekend. With today being “Cyber Monday”, it will be interesting to see how demand holds up. With discounts really high, earnings may not be spectacular but when it comes to the economy, it is all about the number of goods bought, not the dollar value so if people spent more on discounted products, that means consumption should be up sharply. This week we get the employment report so after the euphoria of open-wallets eases, we will get back to the most important economic indicator, jobs. The November payroll gains should be a lot better than the initially reported 80,000 rise in October. There could be a decline in the unemployment rate and an ‘8’ handle would be nice to see again.
Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

October Housing Starts/Weekly Unemployment Claims

Posted on by

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

INDICATOR: October Housing Starts/Weekly Unemployment Claims
KEY DATA: Starts: -0.3%; 1-Family: +3.9%; Permits: +0.9%; 1-Family: +5.1%; Unemployment Claims: 388,000

IN A NUTSHELL: “Housing is firming and some improvement may be in the cards, adding to the view that this recovery is becoming broader based.”

WHAT IT MEANS: The housing sector is a long way away from being healthy but maybe it is starting to get strong enough to move out of the ICU to the recovery room. Housing starts eased a touch in October and on the surface that does not look to be anything positive. However, there was a sharp increase in September and the modest decline indicates the sector managed to sustain that upturn. There was a nice increase in single-family activity but that was offset by a larger drop in the volatile multifamily segment. With the demand for rental housing rising, I expect the multifamily component to keep rising going forward – it just may be in fits and starts. Indeed, with permit requests jumping, improving starts numbers should be seen in the November or December data. Builders are quickly taking those permits and turning them into starts as can be seen in the further decline in the permits authorized but not started pace as well as the increase in the homes under construction rate. As for the labor market, there was a nice drop in new claims for unemployment insurance and it wasn’t just a one week wonder. These data can and do bounce around and the more stable four-week moving average fell below the critical 400,000 level, signifying the likelihood of future declines in the unemployment rate.

MARKETS AND FED POLICY IMPLICATIONS: Another day of pretty good numbers. Don’t expect housing to add lots of jobs or power the economic comeback, but it sure looks like it will be adding to growth going forward. Indeed, the Home Builders Associations confidence measure has jumped two consecutive months as developers seem to be seeing clearly improving conditions. Housing has typically been the first stage of the recovery rocket and its failure to ignite has been a key factor in the sluggish expansion. That the sector may finally be adding jobs is a positive sign. When added to the drop in the claims numbers, you can see that economic conditions are moving upward at an accelerating pace. However, and there is always a however, two major roadblocks stand in the way of solid growth: Rising oil prices and European debt issues. While a European collapse would cause the most problems, I believe that is not likely. If we get what most economists believe will be a mild to moderate European recession, the recovery will be slowed but not killed. But with oil above $100 a barrel, the prospects of $4.00 a gallon of gasoline is of major concern. Worse, the combination of a European downturn and high gasoline prices could move us back to where we were in the spring when the economy was making minimal headway. So, while I like what I see in the economic data, I recognize that we are not out of the woods by any means. That is something the Fed members are quite cognizant of and why Mr. Bernanke is so willing to stick his neck out and say he will keep rates low until mid-2013. As for investors, it remains Europe, Europe, Europe and it will stay that way for a long time.
Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

Buying A Home With Bad Credit

Posted on by

Buying A Home With Bad Credit

When it comes to buying a home, having bad credit is not the end of the world. Your future doesn’t have to be defined by your past. Whether you have suffered from a bankruptcy, foreclosure or some type of financial hardship that resulted in late or missed payments, there are lenders who specialize in financing for those with less-than-perfect credit. You will likely have to produce a larger down payment and/or pay higher interest rates than someone who has good credit, but the important thing to know is that buying a home is an option for you.

Bankruptcy & Foreclosure

If either a bankruptcy or foreclosure is on your credit report, it could take some time before you can qualify for a good interest rate on a mortgage. FHA loans, which are especially desirable for those with past credit problems and first-time home buyers, are backed by the government and offer a low down payment and interest rate option for those who qualify. Although the notation remains for up to 10 years, individuals with a bankruptcy or foreclosure on their credit report may qualify for an FHA loan after two years. Some mortgage lenders may approve a loan sooner, but the interest rates will be higher and the required down payment may be as much as 35 percent of the purchase price of the home.

Cleaning Up Your Credit

Even if you have bad credit, it’s important to check your credit report from each of the three major credit reporting agencies – TransUnion, Equifax and Experian – before applying for a loan. If anything is inaccurate, file a dispute with the reporting agency and request a correction. You can request a free copy of your credit report every 12 months.

In addition to correcting any inaccuracies on your credit report, it’s important that you know what can help or hurt your chances of obtaining a loan. You can start improving your credit by avoiding the temptation to apply for new credit right before submitting a mortgage application. Multiple inquiries will cause your FICO score to drop, and lenders will rely on this information when deciding whether or not to issue your loan and how to calculate your interest rates. With past credit problems, most lenders will want to see that you have rebuilt your credit history with 1-3 major credit cards and timely payments over a two-year period.

Money Matters

When it comes to obtaining a home loan, a healthy bottom line will help the lender to see you as being creditworthy. It’s important that you have sufficient income, along with the ability to prove steady employment for at least one year (longer is better) preceding your loan application. Most lenders will request a copy of your tax returns for the two most recent years, along with current pay stubs. If you have money for a down payment, this will also work in your favor.

Creative Financing

In some cases, a conventional mortgage loan may not be available no matter how hard you try. Owner financing is one way that individuals, who may not otherwise qualify for a traditional mortgage loan, can purchase a home. This type of financing is offered by the owner and may include interest rates comparable to other loans, flexible down payment options and no credit check. Your REALTOR® can assist you in finding homes that offer alternative financing options.

Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

Thanksgiving Menu Ideas

Posted on by

Thanksgiving Menu Ideas

Thanksgiving is an annual national holiday commemorating a harvest festival celebrated by the Pilgrim Fathers in 1621. This day, which is used to express gratitude, is observed in the United States on the fourth Thursday in November. One of the greatest traditions of Thanksgiving is that of a family dinner, which means menu planning is a must. Here are some Thanksgiving menu ideas that will fill your table and the appetite of your guests:

Main Course

The traditional main entrée for Thanksgiving is, of course, turkey. If this isn’t quite your taste, you may want to consider serving ham instead. This is a popular alternative and is a pleasing main course for your dinner guests.

Side Dishes

When it comes to serving a meal, the side dishes are almost as important as the entree. Popular Thanksgiving side dishes include mashed potatoes with turkey gravy, dressing, green beans, sweet potatoes, macaroni and cheese, rolls and cranberries served with cranberry sauce. If you have a large family, it may be a good idea to prepare several side dishes so that everyone will be able to find something that they like.

Dessert

What meal would be complete without the perfect dessert? Whether it’s a pumpkin pie, chocolate pie or other favorite flavor, this traditional treat is common at the conclusion of a Thanksgiving dinner. If you are planning for a large gathering, consider serving several different pies in an effort to accommodate a variety of taste buds.

The Benefits Of A Homemade Meal

Believe it or not, some may choose to dine at a restaurant on Thanksgiving instead of preparing a homemade meal. Although dining out may be easier, it cannot replace the taste and camaraderie of a family dinner at home. Many may shy away from preparing a large Thanksgiving meal because it seems intimidating to cook for so many people. However, with the right recipe, cookware and a little knowhow, your next holiday meal can be a breeze.

Rounding Up The Perfect Recipes

If you know what to cook, but still need a little help with the details, consider looking for the perfect recipes to turn your meal into a masterpiece. While many recipes are available online, many turn to cookbooks and/or women’s specialty magazines for popular recipe and preparation ideas. As the Thanksgiving holiday approaches, there is no shortage of publications containing ideas for creating the perfect meal. Now that you have the perfect menu idea, it’s time to start putting your plan into motion. By planning ahead, your Thanksgiving meal can be stress free and enjoyable for you as well as for everyone who joins you. And don’t lose sight of the reason for your efforts – a time for family and friends to celebrate and give thanks.

Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

Home sale offers new protection

Posted on by

Please click the link below to read this article:

http://www.courierpostonline.com/article/20111103/NEWS01/311030019/Home-sale-offers-new-protection

Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

November 2, 2011 FOMC Decision

Posted on by

NAROFF ECONOMIC ADVISORS, Inc.
Joel L. Naroff
President and Chief Economist

November 2, 2011 FOMC Decision

“…economic growth strengthened somewhat in the third quarter, reflecting in part a reversal of the temporary factors that had weighed on growth earlier in the year.”

Rate Decision: Fed funds rate maintained at a range between 0% and 0.25%

The FOMC ended its two-day meeting with a lot of information. The Committee released its usual statement, an updated economic forecast that took us through 2014 and Mr. Bernanke met the press to answer questions. When all was said and done, we discovered that the Fed thought things got a little better in the fall, the outlook for the future was still somewhat bleak and even lower than the June forecast and the Committee, according to Mr. Bernanke, had everything on the table if conditions didn’t improve.

Let’s start with the statement. The only real change came in the description of the economy. Instead of talking about “continued weakness” there was now a reference to a somewhat stronger growth rate. Of course, the members did note that “recent indicators point to continuing weakness in overall labor market conditions, and the unemployment rate remains elevated”, so you can say that the perception is still of an underperforming economy.

The FOMC did not indicate it would do anything in addition to its current “maturity extension” program commonly referred to as “operation twist”. However, during the press conference, Mr. Bernanke made it clear that additional actions would be taken if necessary. That is not likely to occur anytime soon. However, since the outlook is for the unemployment rate to remain elevated through 2014, it would not be a major surprise if there was another round of quantitative easing. I don’t expect that to happen as I believe growth will be decent enough for the Fed to not have to throw another policy against the wall and hope it sticks. Indeed, even with correct policy, long term growth is likely to be in the 2.2% to 3% range, according to the Fed’s latest forecast. That is less than many are hoping for and basically says that happy days are not going to be here for quite some time.

Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com

Decorating For Thanksgiving Using The Bounty Of The Season

Posted on by

Decorating For Thanksgiving Using The Bounty Of The Season

Thanksgiving marks the beginning of the holiday season, a time spent with family and friends. It is also the time of year when we can spend a lot of money, and in these tough times finding ways to save during the holidays is always welcome. Using the natural bounty available at this time of year is a great, inexpensive, and environmentally friendly option for decorating for the holidays. Here are a few creative ideas for your Thanksgiving decorating!

Harvest Vegetables

The vegetables that are available during the harvest season are not only great to eat, but are also a beautiful and inexpensive way to decorate your home and table. Arrange some pumpkins or large squash on your front steps or by the door. Also use smaller squash as part of a table centerpiece or as candleholders. Corn is another great vegetable that can be used as a decoration during Thanksgiving. A bunch of corn hung on the door or arranged in a vase can create a stunning look at virtually no cost.

Colorful Leaves

The colors of the autumn season are some of the most beautiful of the year, and collecting leaves to use both in crafts and as part of seasonal decorations is a great and inexpensive idea. Leaves can be a beautiful addition to flower arrangements or can make great arrangements all on their own. They can also be used for festive wreaths for the front door or to make Thanksgiving themed garlands.

Nuts, Berries, And Branches

As the autumn season turns to winter, natural decorative items such as nuts, berries, and pine branches can be great choices not only for the Thanksgiving season but can easily transition into the Christmas season. Adding some walnuts to your Thanksgiving table or some berries to a wreath can add a nice touch that will last you through the season.

Getting creative with the natural bounty at this time of year is a great way to give your home a beautiful and traditional holiday look without breaking the bank.

Re/Max Connection Realtors disclaimer:
Re/Max Connection Realtors are not licensed financial advisors, and are not providing any financial advice, you should consult with a licensed financial advisor prior to making any financial decisions. Re/Max Connection Realtors are only providing this economic statement from Naroff Economic Advisors, Inc. for informational purposes.
Our company accepts no liability for the content of this email/blog, or for the consequences of any actions taken on the basis of the information provided. Any views or opinions presented in this email/blog are solely those of the author and do not necessarily represent those of the company. Finally, the recipient should check this email and any attachments for the presence of viruses. The company accepts no liability for any damage caused by any virus transmitted by this email.
Re/Max Connection Realtors, 1000 East Lincoln Drive, Suite 2, Marlton, NJ 08053 www.goconnectionnj.com