Two reports out on Wednesday point out different takes on the US economy. Home sales reduced in November for the 10th straight month but consumer confidence continues to rise.
Home sales decline again
The trading of already occupied U.S. homes deferred for the tenth consecutive month in November, strained by a tight inventory of properties on the market and mortgage rates with an average of more than double than the previous year ago.
According to the National Association of Realtors on Wednesday, existing home sales dropped 7.7% from the preceding month to a seasonally adjusted annual rate of 4.09 million. That’s lessened than what business analysts had expected, according to FactSet.
Sales dropped 35.4% from the previous November, leaving a steep slowdown in sales that happened in May 2020, when the pandemic began. Presently, the sales are at the slowest annual pace past October 2010, when the housing market was frozen in a profound collapse following the foreclosure crisis of the late 2000s.
Despite the slowdown, home prices continued to soar in November at a lower rate than just a few months ago. The national average home sales price rose to 3.5% in November from the previous year to $370,700.
For the fourth consecutive month, the number of available homes on the market has decreased. By the end of November, 1.14 million homes were on the market. That accounts for a 3.3 months supply at the current sales pace.
The confidence of American consumers surfaced again this month to end the year on a relatively high note despite soaring interest rates that made credit cards and mortgages more costly and growing anxiety about a possible recession.
The Conference Board reported on Wednesday that the consumer confidence index expanded to 108.3 in December, up from 101.4 the previous month. It’s a sharp revival, pushing the index to its maximum level since April. Conversely, last month’s figure was the lowest since July.
The business research group’s present situation index, which measures consumers’ perceptions of current business and labour market conditions, expanded from 138.3 in November to 147.2 this month.
The board’s expectations index, which measures consumers’ six-month outlook for income, business, and labor conditions, rose to 82.4 from 76.7. Recession is considered as a reading near or below 80.
Recent consumer behavior has been tricky to get a clear read.
Americans have sharply cut back on retail spending in November as the holiday shopping season began, as reported by the government last week. In addition, high prices and rising interest rates have forced families, mainly from lower-income backgrounds, to make more challenging decisions about what they buy.
- Published By Team Nation Press News