1. I s su e 12 , Vo lu me 4 2 / Oc t o be r 2 1 , 201 1
It IS Time to Buy That House… The Week Ahead -> The “Keys”
Tim McLaughlin - Will monthly S&P/CS go positive two months in a row?
…was the headline of a great article that ran in the Wall
Date Economic Release Prediction Last
Street Journal’s weekend section last week. For those of
you who didn’t get a chance to see it, here is a synopsis.
10/24 Chicago Fed Nat Activity -0.31 -0.43
The nation's ratio of house prices to yearly rents is
10/25 S&P/CS 20 City (MoM) 0.15% 0.05%
nearly restored to its pre-bubble average, U.S. house
prices have plunged by nearly a third since 2006, 10/25 S&P/CS 20 City (YoY) -3.55% -4.11%
making it a terrific value proposition.
10/25 S&P/CS Home Price Index - 142.77
Taking historically low mortgage rates into
consideration, houses are the most affordable they 10/25 Consumer Confidence 46.0 45.4
have been in several decades.
10/25 Home Price Index (MoM) 0.2% 0.8%
“Price to Rent” ratios are among the lowest since the
10/26 MBA Mortgage Applications - -14.9%
1960’s, with the combination of housing prices coming
down and rents maintaining their price levels of 5 years 10/26 Durable Goods Orders -0.7% -0.1%
ago (even increasing to some degree in some cases):
o The Philadelphia region tri-state price to rent 10/26 ex Transportation 0.5% -0.1%
ratio is reported at 11.6
10/26 Cap Goods Orders 0.5% 1.1%
o Washington/Southern MD/Northern VA is at
13.3 10/26 Cap Goods Shipped - 2.8%
o The New York Metro Area is at 17.6
o All three of these regions are down significantly 10/26 New Home Sales 300K 295K
from where they were in 2005 to 2008
o Nationwide, the average is 11.3, down 10/26 New Home Sales (MoM) 1.7% -2.3%
significantly from the peak of 18.5 according to
Moody’s 10/27 GDP (QoQ) 2.5% 1.3%
10/27 Personal Consumption 1.9% 1.7%
The numbers are quickly turning in the buyers favor:
stock-oriented individuals can think of a house's 10/27 Core PCE (QoQ) 2.2% 2.3%
price/rent ratio in line to a stock's price/earnings ratio, in
that it compares the cost of an asset with the money the 10/27 Initial Jobless Claims 400K 403K
asset is capable of generating. For investors, a lower
ratio suggests more income for the price. For 10/27 Continuing Claims 3690K 3719K
prospective homeowners, a lower ratio makes owning
10/27 Pending Home Sales (MoM) 0.1% -1.2%
more attractive than renting, all else equal.
10/27 Pending Home Sales (YoY) 10.8% 13.1%
So how does the value conscience consumer capitalize
on this? Your first step is to meet with your knowledgeable 10/28 Personal Income 0.3% -0.1%
Weichert Realtor and your trusted Weichert Financial Gold
Services Manager to strategize a plan and set your course 10/28 Personal Spending 0.6% 0.2%
of action. With the buy vs. rent equation never being more in
10/28 U of Michigan Confidence 58.0 57.5
your favor, coupled with near historically low interest rates,
the time to capitalize is now. Ask us how…we can help! 10/28 PCE Core (MoM) 0.2% 0.1%
Mortgage Access Corp. d/b/a Weichert Financial Services, Executive Offices, 225 Littleton Road, Morris Plains, NJ 07950. 1-800-829-CASH. NMLS Company ID: 2731. Licensed by the NJ Dept of Banking and Insurance. Licensed Mortgage
Banker with the State Dept of Banking in NY and CT. Licensed by the Pennsylvania Department of Banking, Mortgage Lender 21042. Licensed Lender in AK, AR, DE, MD, D.C., GA, ME, MI, MN, WI, IA, IL, IN, LA, VT, FL, WV, RI, KY, NC,
ID, MS, NE, WY, OK,TN, WA. Licensed by the Virginia State Corporation Commission, License #ML105. Licensed Mortgage Lender in the Commonwealth of Massachusetts. License #ML1713, Certificate #43155. Certificate of Authority to
transact business in CO, SC. Registered Mortgage Lender in TX. Licensed with the Financial Institutions Division in New Mexico, License # 01297. Licensed by the Department of Corporations under the California Residential Mortgage
Lending Act. Licensed Mortgage Broker and Lender Ohio. Licensed Loan Broker and Lender Rhode Island. Kansas Licensed Mortgage Company, License #MC.0001229. Licensed by the New Hampshire Banking Department, License #
8714-MB. Licensed Oregon Mortgage Lender License #ML2528. Weichert Financial Services arranges loans with third-party providers. Equal Housing Lender.
