U.S. Outlook: Is housing still on fragile ground?

Scott Anderson
Posted by Scott Anderson
Chief Economist

Janet Yellen’s recent testimony to Congress raised the possibility that the housing slowdown may be more prolonged than a winter lull.

Housing affordability index - graphBut we’re forecasting some improvement in April’s numbers and see other reasons for near-term optimism.

For more on the latest economic developments to watch, see higlighhts of my weekly economic analysis below, followed by a link to the full U.S. Outlook report, delivered on May 16, 2014.

Key observations:
  • Home builders’ expectations of future sales and prospective buyer traffic are the strongest since January.
  • We are forecasting improvement on both new and existing home sales on the month.
  • Initial jobless claims fell below 300K last week, the best reading so far in this expansion. This is one reason for optimism on housing.
  • Another reason for optimism: home price appreciation is decelerating at the national level.
  • Pent-up housing demand, low interest rates, and a stronger economy should rekindle positive momentum in housing market in coming months.

Click here to read my full report.

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