Home Sales Bouncing Back When Economy Needs It Most

Aug 28, 2014 9:15am

 

ap housing report jc 140828 16x9 608 Home Sales Bouncing Back When Economy Needs It Most

  (Photo Credit: Michael Dwyer/AP Photo

Morning Money Memo:

Happy days are here again for housing … sort of.

After more than a decade of boom and bust, a vital part of the U.S. economy may be finally returning to normal. That could be very good news for growth. Signs of stability include slower price rises and fewer sales of distressed properties.

“Home prices look roughly in line with their long-term norms and, very importantly, far fewer people are falling behind on their payments,” Jed Kolko, chief Economist at Trulia, the online real estate firm, says. “More and more the housing recovery depends on what happens in the jobs market.”

Foreclosures dropped sharply in July, falling more than 21 percent in the past year, says data firm CoreLogic. On a month-over-month basis, completed foreclosures were down by 8.5 percent. “The stock of distressed debt continues to rapidly decline, especially in western states,” economist Sam Khater said.

“Based on current trends, the overall foreclosure inventory could trend down to as low as 500,000 homes by year-end, which is very positive news for the housing market,” Anand Nallathambi, president and CEO of CoreLogic, said.

And there’s a little good news for motorists. Labor Day will be the cheapest holiday travel weekend in four years: “Mildly cheaper than last year, quite a bit cheaper than in 2012,” Tom Kloza, chief oil analyst at GasBuddy.com, said.

Despite unrest in the Middle East, “We are producing about 3.1 million barrels a day more domestic crude in the United States than when the first Arab Spring took place,” he said.

U.S. gasoline demand has also been reduced by more fuel-efficient vehicles.

The latest sign of economic strength came this morning. After a bleak start to the year, U.S. output rebounded vigorously in the April-June quarter, growing at a brisk annual rate of 4.2 percent, slightly faster than first estimated.

The upward revision supported expectations that the second half of 2014 will prove far stronger than the first half

With the football season right around the corner, excitement is building. And the big game may be contributing to growth. CareerBuilder and Economic Modeling Specialists Intl took a look at post-recession job growth in the six largest sports-related industries in the United States. Combined, jobs in sports-related industries have increased by 12.6 percent in the past four years, according to the research. That compares with overall national job market grew of 5.5 percent. Earnings in most sports-related jobs are significantly higher than the national average.

America’s biggest bank may have been targeted by hackers. Federal agents are investigating a potential major breach of JPMorgan Chase’s computers and those of at least one other major financial institution, law enforcement sources told ABC news. But investors don’t appear to be worried. Since the first report of hacking emerged, the bank’s share price was little changed. A statement by JPMorgan says “companies of our size unfortunately experience cyber-attacks nearly every day,” and that there has been no unusual level of fraud activity detected.

Just how long can the stock market keep on growing? The S&P 500 closed Wednesday at a new record high for a third day in a row. But trading volume was less than normal before the approaching Labor Day weekend.

Richard Davies Business Correspondent ABC News Radio abcnews.com

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