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Pollack: Phoenix, Tucson single-family resales doing well
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The Source for Information and Analysis on the Arizona Economy and Real Estate
EDP LogoELLIOTT D. POLLACK

& Company

FOR IMMEDIATE RELEASE
October 10th, 2016
 
The Monday Morning Quarterback
A quick analysis of important economic data released over the last week
The latest economic data suggests more of the same.  An economy that continues to grow, but, at an anemic rate.
The Blue Chip consensus forecast for real GDP for 2016 remains at 1.5% year-over-year growth.  Next year is forecast to grow by 2.2%.  It would be the 8th year of a below average expansion.  But, growth it is.  Employment continues to inch upward.  Manufacturing is doing the same after a one month contraction.  The outlook also improved in the non-manufacturing sector.  Private construction is also up.  Public construction is not.
In Greater Phoenix, single family resale activity continues to do well and the spread between the price of new vs. existing single family homes, while still abnormally high, is moving in the right direction.  The Greater Tucson resale market also continues to improve.
U.S. Snapshot:
  • Total nonfarm payroll employment increased by 156,000 in September.  This compares to an average of 178,000 for the first seven months of 2016 and an average of 229,000 per month in 2015.  Employment gains occurred in professional & business services (+67,000) and in health care (+33,000).  The unemployment rate was little changed at 5.0%.  That’s up slightly from the 4.9% reported in August and down slightly from 5.1% a year ago.
  • Consumer credit proved very strong in August.  It was up a surprisingly strong 8.5% at an annual rate and stands 6.3% above year earlier levels.  There was sizable growth in revolving credit, a component that represents the use of credit cards.  So far in the cycle, nonrevolving credit, the component that represents noncredit card debt such as auto loans and student loans, had been growing rapidly.  But, consumers had been playing things much closer to the vest with their credit cards in an attempt to keep their financial house in order.  Yet, this month’s gains in revolving credit suggest that consumers are more willing to drive up credit card use.  That is uncertain news for household wealth but clearly good news for the nation’s retailers.  Nonrevolving credit was up at a 9.0% annual rate in August.  That’s a 6.3% increase over a year ago.
  • New orders for manufactured goods in August increased 0.2% over last month and now stand 1.6% below a year ago.  Inventories were down 2.2% from a year ago.
  • The ISM’s manufacturing index expanded in September from 49.4 to 51.5.  This is significant because a reading of more than 50 suggests that manufacturing is expanding.  Below 50 suggests it’s contracting.
  • The ISM’s nonmanufacturing index rose from 51.4 in August to 57.1 in September.  This was the 80th consecutive month of expansion in the nonmanufacturing sector.
  • Auto and light truck unit sales expanded to 17.7 million in September.  This was up from 16.9 million in August but down slightly from 18.0 million a year ago.  Most of the strength was in domestic vehicle sales.
Arizona Snapshot:
  • According to the Cromford Report, total active listings (including new and resale residential sales) in Greater Phoenix have remained on a plateau between 23,000-27,000 range over the past year.  Total sales in Maricopa County, on the other hand, were up 7.8%.  Not surprisingly, total median sales prices were up 9.0% from a year ago to $242,925.  That’s up from $222,812 a year ago.
  • In Greater Tucson, listing activity in September was down 18.6% from a year ago to 3,996 residential units (all home types).  Sales were up 10.6% to 1,331.  Surprisingly, median sales prices have been slow to increase and stand only 2.9% over a year ago.
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Rose Law Group Reporter, which provides Dealmaker’s content and service, is contracted by Rose Law Group. Rose Law Group is a full service real estate and business Law Firm practicing in the areas of land use/entitlements, real estate transactions, real estate due diligence/project management, special districts, tax law, water law, business litigation, corporate formation, intellectual property, asset protection, data breach/privacy law, ADA compliance, estate planning, family law, cyber-law, online reputation and defamation, lobbying, energy and renewable energy, tax credits/financing, employment law, Native American law, equine law, DUIs, and medical marijuana, among others. The views expressed above are not necessarily those of Rose Law Group pc or its associates and are in no way legal advice. This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.