Signs that the US housing market has turned the corner and is on the recovery road are mounting – one wonders when the evidence will become irrefutable?
The latest news shows that the number of building applications rose to a four year high in July, as builders took out 812000 building permits, more than at any point since August 2008. This is well above the 769,000 median estimates of 52 economists surveyed by Bloomberg, and even above their highest estimates (estimates ranged from 737,000 to 805,000). This just one month after housing starts hit a three year high of 754,000 in June, although this figure did drop slightly to 746,000 in July.
Despite the fact Americans were the most pessimistic on the economic outlook since late last year in July according to another report citing rising fuel costs and the like, the property market continues to power on – through the odd set-back like housing starts in July for example - as buying becomes cheaper than renting in most places and banks become more willing to lend,
"Housing is one of the bright spots in the economy," said Ryan Sweet, a senior economist at Moody's Analytics Inc. in West Chester, Pennsylvania. "The recovery's resilience will be tested over the next couple months because of Europe, the weakening in China, and also given that the consumer and business moods are rather gloomy right now."
FDI in China fell in July to the lowest level in two years, fuelling concern that waning confidence in the nation's growth prospects may restrain any economic rebound. Meanwhile the latest Bloomberg Consumer Comfort survey found that 45 percent of US households believed the economy was going badly in August, this was the highest percentage since November and up from 36 percent the prior month.
- Monday 20 August 2012