Home Prices Soared Over Last Year Alongside Fantastic Consumer Spending

Home Prices Soared Over Last Year Alongside Fantastic Consumer Spending Plymouth Title Guaranty Corporation

Recent reports revealed that home prices soared over last year. In addition, consumer spending put up stronger than anticipated results.

Meanwhile, the U.S. economy faced highs and lows in other sectors. Job creation stifled amongst the onset of The Great Resignation. Inflation continues to rise as it has been throughout the economic recovery. And the vaccine mandates prompt mass firings and service declinations.

Conclusively, September 2021 represented a tricky time for investors.

Home Sales Fall; Median Home Prices Rising

In August 2021, existing home sales fell 2% from July, matching expectations. Having said that, home prices soared as the median existing-home price ($356,700) rose 15% higher than last year at this time. Inventory levels decreased 13% from a year ago. Currently, home inventory sits at just a 2.6-month supply nationally, well below the balance of 6.0 months.

Given the critical need for more homes, investors closely watch monthly reports on housing starts. The latest data contained mixed news. In August, overall housing starts rose 4% from July, which was well above the consensus forecast.

COVID-19 Spread Dampens Job Creation

Aside from how the home prices soared, the economy did not perform as well in the job creation department. With COVID-19 still running rampant (and new variants spreading) the economy underperformed in terms of job creation. In August 2021, the economy added a mere 235,000 jobs. As a result, job gains tumbled well below the forecasted 720,000. Also, job gains dropped from July’s one million plus.

On a positive note, the unemployment rate declined from 5.4% to 5.2%. Thus, unemployment reached the lowest level since prior to the pandemic. Finally, average hourly earnings rose 0.6% from July.

Strong Consumer Spending Coincides with Soaring Home Prices

In August, retail sales grew 0.7%, above the consensus for a decline of -0.8%, coinciding with the soaring home prices. Sales launched an impressive 15% higher compared to one year ago.

Department stores and furniture sales bore particular strength. Conversely, auto sales came across as weak. The auto industry notoriously faces a lack of inventory, primarily due to chip shortages.

Looking Ahead After Home Prices Soared

After home prices soared, investors now closely watch COVID-19 case counts around the world. They also look for hints from Fed officials about the timing for changes in monetary policy. Additionally, governmental COVID-19 regulations could impact the economy significantly in coming weeks.

With the supply chain troubles, vaccine mandates, mass resignations, and rising inflation impacting the markets, investors confront a unique time in American history.

For further information on the lifted eviction moratorium, reach out to the title and escrow specialists at Plymouth Title Guaranty Corporation.

Please note: The safety of our staff and clients is our highest priority.  Effective immediately, Plymouth Title Guaranty Corp. will be taking the following precautions to limit the spread of the COVID-19 virus:

All purchase transactions need to take place at a Plymouth Title Guaranty Corp. closing office.

  • If a party to the closing is not feeling well, please contact your closer before the closing so appropriate precautions can be taken.
  • We ask visitors to utilize the restroom in our building upon arrival to thoroughly wash their hands before entering our office.
  • Only individuals required to sign and/or deliver documents at closings will be allowed in our office. Specifically, closings will be limited to borrower(s), seller(s), agents, and lenders.
  • All pens used in the closing will be given to the client after use.
  • All closing rooms will be cleaned and disinfected in-between each closing.
  • Those picking up checks at our office will be instructed to call our main line and request to speak to a staff member who will plan for delivery to the lobby or parking lot of our office.
  • All staff will refrain from shaking hands before or after closings and ask clients to do the same.

Please be advised that our staffing may be impacted during this unprecedented event. While we are committed to continuing to provide outstanding service, we ask for your patience in the face of this pandemic.