Cash Deals Jump, Home Prices Rise

Aug 29, 2013 8:38am

Morning Money Memo…

Two new reports show the housing market continues to improve despite concerns over rising mortgage rates. But there are large variations in markets across the country. “Nationwide we did see home sales volume continue to increase,” says Darren Blomquist of RealtyTrac. The home price index rose in July 4 percent from the previous month and 6 percent from a year ago. But in California and much of the Southwest average prices shot up 20 percent compared with 2012. The RealtyTrac survey says that all-cash deals jumped to 40 percent of all homes, up from 35 percent in June. “That was really surprising to us how much cash purchases jumped just from June to July,” says Blomquist.

Foreclosures plunged sharply in July compared with last year, according to the information firm CoreLogic. It says there were 49,000 completed foreclosures in the US. in July 2013, down from 65,000 the year before. On a month-over-month basis, completed foreclosures decreased 8.6 percent. But the market is still in a state of repair. Core Logic says completed foreclosures averaged 21,000 per month nationwide between 2000 and 2006.

It’s never easy to predict what’s next for the stock market. Despite the threat of US military action against Syria’s government, and worries about the volatile Middle East if there is an attack, stock averages closed up yesterday and futures are higher this morning. The Dow rose 48 points yesterday, the S&P 500 gained 4 points and the Nasdaq added nearly 15 points. The sell-off appears to have abated for now but the trend for the market in recent days has been down.  Oil prices are down nearly a dollar a barrel to just over $109 for West Texas crude.

Ford is the latest big manufacturing company to bring more jobs back to the US. Until now the Ford Fusion, one of America’s top-selling cars, was only made in Mexico. Starting today the firm’s Flat Rock Michigan plant will start making the Fusion. With rising US car sales Ford has hired 1400 workers to build the car at the same plant that manufactures the Mustang. Recently, the Fusion has come close to closing the gap with Toyota’s Camry, the number one selling car in the US.

Verizon Communications and Britain’s Vodafone are in talks about a potentially huge agreement that could cost the largest US cell phone provider more than $100 billion. The two firms have been discussing a deal for Verizon to buy out Vodafone’s 45 percent stake in Verizon Wireless. Vodafone shares in London rose more than 8 percent this morning on word of the talks, which may conclude with a deal days from now.

The US government and Switzerland have reached an agreement that could expose Americans who have used Swiss banks to avoid paying taxes. The agreement will allow Swiss banks to settle any potential US charges if they disclose extensive information about their American clients, the value of their accounts and any help they received from tax professionals.

Richard Davies Business Correspondent ABC News Radio abcnews.com Twitter: daviesabc

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