Market Matters

Economists Differ on Impact of Falling Oil Prices on Housing Source: Wall St. Journal In a big increase from 2014, economists are anticipating that home builders will start construction on as many as 804,000 new single-family homes this year. But will falling oil prices affect housing construction? Some economists predict there could be an indirect benefit to the housing market in the form of more consumer spending, which will create more job/income growth and by extension make it easier for people to buy homes. But there are concerns that there could be a slowdown to housing construction activity in oil-focused local economies, such as cities in Texas. Read the full story   Will 2015 be better for California’s housing market? Source: HousingWire   While prices are still very high, 2015 may fare slightly better for potential buyers in California thanks to mortgage interest rates trending lower and loosening lending standards. The California housing market stayed in line with 2014 predictions and hopefully set the pace for a better 2015, according to PropertyRadar’s December Real Property Report. California’s real estate market continues to show steady improvement, as the number of homeowners in a negative equity position fell 1.1 percent to 987,000 in December, and the number of underwater borrowers shrank 28.5 percent for the year. Read the full story Housing is about 75% back to normal: Report Source: CNBC The U.S. housing market is about three-quarters of the way back to "normal," according to a new report from Trulia. Both sales and prices of existing homes are 82 percent back to normal levels, compared with a year ago, when they were just 73 and 66 percent recovered, respectively. Single-family housing starts are still struggling, as household formation is almost entirely on the rental side. The recovering employment of 25- to 34-year-olds is also an important factor for housing. Read the full story   Builder confidence holds steady in January Source: The Hill   According to the latest National Association of Home Builders/Wells Fargo Housing Market Index, there is plenty of optimism in the housing market's future, but home builder confidence did fall a point in January. It was the third straight month that the index has hovered in the upper 50s. The component gauging current sales conditions remained unchanged at 62 in January, while the index measuring expectations for future sales dropped 4 points to 60 and the component gauging traffic of prospective buyers fell 2 points to 44. Read the full story U.S. single-family starts hit 6-1/2-year high in December Source: Reuters As the housing market continues to recover, U.S. housing starts rose more than expected in December as groundbreaking for single-family homes hit its highest level in more than 6-1/2 years. The Commerce Department reported that starts increased 4.4 percent to a seasonally adjusted annual pace of 1.09 million units. Groundbreaking on single-family projects in the West hit a seven-year high, while starts in the Midwest were the highest since December 2011. Read the full story HUD’s Castro says first-timers should buy homes right now Source: HousingWire  Housing & Urban Development Secretary Julián Castro received questions from challenged home buyers in a chat hosted by Zillow. Castro touted homeownership as an important way to build wealth. He commented, “Investment in a home is an investment in the long run in creation of wealth. A confluence of better economy, wages starting to go up and gas prices going down create some breathing room for people stuck in that rut to save some money to buy that first home.” Read the full story