Housing Prices, Consumer Confidence, Rental slump in 2016?
January 26, 2016
Tuesday – January 26
The housing markets begin the new year with positive news on home price appreciation. The S&P/Case Shiller 20-city Home Price Index rose 5.8% year-over-year due to continued low mortgage rates, tight supplies and an improving labor market. On a monthly basis, prices were up 0.9% from October, the fastest monthly gain since March. Within the report it said that 14 cities put up better gains in November than they did in October.
Despite the recent sell-off in the U.S. Stock markets, Americans confidence regarding the economy rose in January. The Conference Board reported that Consumer Confidence rose to 98.1 this month, above the 96.8 expected and above the December reading of 96.5. Lynn Franco, Director of Economic Indicators at The Conference Board said, “For now, consumers do not foresee the volatility in financial markets as having a negative impact on the economy.” The report went on to reveal that consumers’ outlook for the labor market was also slightly more optimistic.
The hot rental markets that occurred in 2015 may start to cool off a bit in 2016, reports online real estate listing service Zillow. However, Zillow did caution that rents will remain high in many of the major markets across the nation, especially on the West Coast. Nationally, Zillow expects rents to flatten, rising just 1.1% in 2016 after the 4.6% increase in 2015. “The slowdown in rental appreciation will provide some relief for renters who’ve been seeing their rents rise dramatically every single year for the past few years,” said Zillow Chief Economist Svenja Gudell. “However, the situation remains tough on the ground: rents are still rising, and renters are struggling to keep up.”