2013 Jobs Forecast
The Federal Reserve released job data stating the unemployment rate will remain elevated through late 2015. Unemployment and under-employment continue to weigh heavily on the US economy as 17,000 Americans filed new unemployment benefit applications this week. According to the Federal Reserve the US needs over 200,000 new jobs created each month to break even with newly minted graduates entering the work force. 151,000 new jobs were created in November 2012 with 4.5 million Americans unemployed. As such, it seems more than plausible that short sales will remain a part of the economic landscape at least for the time being. Associated Press released its survey of the nation’s top economists which anticipates 2013 GDP growth to be 2.1% below the 3.5% threshold of real economic growth able to pull the US out of the sluggish housing recovery. Economists noted the tepid growth remains consistent with the past 3 years and expect no significant change in 2013.
New Housing Starts Down
New housing starts are back down again after the short lived influx from Super Storm Sandy. Super Storm Sandy destroyed an estimated 40,000 homes that will be rebuilt next year but that is still not enough building activity to move the national new construction data significantly. Housing starts on the West are down 19% while housing starts on the East Coast are down 26%.
Is Supply Keeping Up With Demand?
The total numbers of sold residential homes was up only slightly year over year 2011 – 2012 as many cost-conscious consumers are feeling budget restraints. Home values made modest gains in 2012 which has not been enough to relieve the financial stress of many underwater mortgage holders. New Foreclosure rate cooled slightly as many states have been working though court challenges to foreclosure procedural process raised by homeowners in default. Recently most of these court challenges have been resolved or expected to be resolved shortly. HUD remains consistent with its outlook of gaining additional foreclosed home resale inventory 2013.
Distressed properties including short sales are maintaining similar inventory levels as the year prior and are not expected to decline in volume during 2013. Banks have sough relief from foreclosure losses as repossessions are costly and present problems with title transfer and other issues after the reconveyance of the deed is completed. Overall US home sale volume saw an increase of 5% over last month due to favorable interest rates.