Economy Watch: Existing Home Sales Edge Up in January
- Feb 23, 2012
The National Association of Realtors reported on Wednesday that existing home sales saw an uptick in January compared with December. Existing homes sold at an annualized rate of 4.57 million units during the first month of 2012, up 4.3 percent from a downwardly revised 4.38 million-unit pace in December 2011. The January 2012 figure is also a little—0.7 percent—higher than the 4.54 million-unit sales rate of the same month in 2011.
Housing inventory is still sliding, the NAR also reported. Total U.S. housing inventory at the end of January was 2.31 million existing homes available for sale, which represents a 6.1-month supply at the current sales pace, down from a 6.4-month supply in December. That’s the lowest level of inventory since 2005, back when the residential property bubble really started inflating with gusto. At the peak of the bubble in July 2007, there were a little more than 4 million homes on the market.
The NAR stresses that housing is more affordable now than ever, which of course means depressed valuations. The organization also reported that national median existing-home price for all housing types was $154,700 in January, down 2 percent from January 2011. Distressed homes accounted for 35 percent of January sales (22 percent were foreclosures and 13 percent were short sales), up from 32 percent in December; they were 37 percent in January 2011.
Vehicle miles driven drops in ’11
The U.S. Department of Transportation said this week that travel on all roads and streets was up in January by 1.3 percent, or 3.2 billion vehicle miles (a little less than the average distance from the Sun to Pluto), compared with December. But total travel in 2011 was down 1.2 percent, or 35.7 billion vehicle miles.
In previous decades, number of vehicle miles driven on U.S. roads has been taken as a rough measure of the direction of the U.S. economy. Less driving has meant fewer people going to work, fewer shoppers visiting retail establishments, and fewer travelers going places and spending money. But now the link between total driving and economic performance isn’t quite so straightforward.
Since the surge in gas prices in early 2008—it inspired near-panic, and was only overshadowed by the real panic in September—Americans have changed their driving habits. People are riding trains and buses more, buying more things without leaving their house, buying and using more fuel-efficient vehicles, and being a little wiser in how much they drive (combining trips and the like). Ever higher gas prices would still hurt the economy, of course, but perhaps not quite as much as four years ago.
Architects say their business is up
The American Institute of Architects reported on Wednesday that its Architecture Billings Index remained in positive territory in January, standing at 50.9, which followed a mark of 51 in December. The index is a leading indicator for the commercial property development business, with architect participants asked whether their billings increased, decreased, or stayed the same in the month that just ended as compared to the prior month.
More than 50 means an increase, so while the index is positive, it’s just barely positive. Still, January marked the third positive month in a row. “Even though we had a similar upturn in design billings in late 2010 and early 2011, this recent showing is encouraging because it is being reflected across most regions of the country and across the major construction sectors,” AIA chief economist Kermit Baker noted in a press statement.
Wall Street was neither here nor there on Wednesday, with the Dow Jones Industrial Average edging downward by 27.02 points, or 0.21 percent. The S&P 500 and the Nasdaq lost 0.52 percent and 0.33 percent, respectively.