Dec 22, 2014 | Market Outlook
Last week’s scheduled economic events were few but informative. Housing related reports included the National Association of Home Builders/Wells Fargo Housing Market Index for December, which stayed close to a nine-year high reading of 59 in September. December’s reading was 57 and fell two points shy of the expected reading of 59. November’s reading was 58. Readings above 50 indicate that more builders are positive about market conditions than those who are not.
Housing Starts for November were lower according to the Department of Commerce’s report released Tuesday. The reading for November was 1.028 million starts on a seasonally adjusted annual basis. Analysts expected a reading of 1.035 million housing starts based on October’s level of 1.045 million starts.
Fed Confident, but Watchful of Economic Conditions
The Fed’s Federal Open Market Committee (FOMC) released its statement at the conclusion of its final meeting in 2015. Fed Chair Janet Yellen also gave a press conference that primarily supported information contained in the statement. The Fed did not foresee rising the target federal funds rate until mid to late 2015, and said that no changes were likely to be made at the first two FOMC meetings of the year. The target federal funds rate remains steady at 0.00 to 0.250 percent. FOMC members noted improvement in labor markets, but said that housing continued to recover at a slow rate. The Fed repeated its customary statement that FOMC members would monitor ongoing economic conditions and developments as part of any decision to change monetary policy. Chair Janet Yellen affirmed the committee’s position in her press conference.
Mortgage Rates, Jobless Claims Fall
Mortgage rates fell according to Freddie Mac. The average rate for a 30-year fixed rate mortgage was 3.80 percent as compared to the prior week’s reading of 3.93 percent. The average rate for a 15-year fixed rate mortgage was 3.09 percent, which was 11 basis points below the prior week’s reading. 5/1 adjustable rate mortgages had an average rate of 2.95 percent; this was three basis points lower than the previous week. Discount points remained steady at 0.50 percent with the exception of average points charged for a 15-year mortgage, which increased to 0.60 percent.
Weekly jobless claims fell to 289,000 against expectations of 295,000 new jobless claims; expectations were based on the prior week’s reading of 295,000 new claims. Analysts cautioned that weekly jobless claims readings can be particularly volatile during the holiday and early winter season.
What’s Ahead
Economic news scheduled for next week includes the National Association of Realtors® report on November sales of existing homes and November sales of new homes, which is issued by the Department of Commerce. Consumer sentiment, consumer spending and core inflation reports will also be issued next week. No economic reports will be issued Thursday or Friday due to the Christmas holiday.
Dec 19, 2014 | Around The Home
Light is an important design element that can be used to influence your interior decor in a number of ways. In fact, you can experience a major transformative change on the overall style and ambiance of a room by making a few simple lighting changes. Consider how these ideas can help you to improve the look of your space with great results, and think about ways that you can improve your space by making a few changes.
The Addition of Spotlights
If you have fine pieces of artwork, decorative display areas or other features that you want to illustrate with beautiful clarity, the addition of spotlights is a great idea. You can shine light on these special features in your home by installing a single, bright fixture with a focused beam overhead, or you can use track lighting to highlight larger features. In some cases, the design or layout of your room may be sufficient to allow lighting to be placed at eye-level or even below the fixture to shine upward at it.
Background Illumination
While spotlights can shine a focused beam of light on fixtures, you can also use background lighting for ambiance. Consider how you can incorporate background lighting with under-cabinet kitchen lighting, dimmer recessed lighting placed behind a sofa or other features. Generally, these are lights that do not provide direct lighting, and the light may not be the main source of light in the room. It may even have a hint of color to it for a dramatic flair that further establishes ambiance.
Beautiful Lamps
Another idea is to use beautiful or decorative lamps in your room. These may be smaller desk lamps, towering floor lamps or table top lamps. There are lamps available in a wide range of colors, sizes and styles. The lighting from the lamps may influence ambiance and provide functional lighting, but the decorative nature of the lamps themselves can enhance the décor even when the lights are not turned on.
There are many different types of lighting that can influence your home’s décor, and in many cases, it makes sense to incorporate each of these styles of lighting in a single room to enjoy different benefits. You can study your rooms’ layouts and designs today to learn more about how the existing light fixtures influence decor, and you can make a few appropriate changes to enjoy better overall results for your space.
Dec 18, 2014 | Market Outlook
The Federal Open Market Committee (FOMC) said in its last statement for 2014 that although economic conditions have improved at a moderate pace, the Fed believes that the target federal funds rate of between 0.00 and 0.25 percent remains “appropriate.” While labor markets show expanding job growth and lower unemployment rates, FOMC members noted that housing markets are recovering slowly.
Inflation remains below the committee’s target rate of two percent; this was attributed to lower fuel costs. Household income and business investment were seen as increasing, and the underutilization of workforce resources was described as “diminishing.” These developments indicate better economic conditions for consumers, business and job seekers, as employers picked up the pace of hiring.
Target Fed Funds Rate Unchanged
No year-end changes in monetary policy were made; the Fed issued its usual statement that developing economic conditions would guide the Committee’s decisions concerning the target federal funds rate. The FOMC statement said that changes could be made according to progress toward or away from achieving the Fed’s dual mandate of maximum employment and price stability. No specific date was given for raising the target federal funds rate. The FOMC statement noted that no change is likely as long as the inflation rate remains below the Fed’s longer-term target of two percent.
The FOMC statement was followed by a press conference given by Janet Yellen, fed chair and Chair of the FOMC.
Fed Chair: Oil Price Influence on Inflation “Transitory”
Janet Yellen, chair of the Federal Reserve and FOMC, said that she expects lower oil prices to be a transitory influence on inflation, which continues to run lower than the Fed’s target rate of two percent. Media representatives noted that Chair Yellen replaced the phrase “considerable time” with “patient” in reference to when the Fed might raise the target federal funds rate.
Ms. Yellen said that the gross domestic product (GDP) had increased by 2.50 percent over the prior four quarters ending with the third quarter of 2014, and said that the economy continues to grow at approximately the same pace. Concerning falling inflation, Ms. Yellen said that she expected the inflation rate to increase after transitory influences including oil prices dissipate. The Fed Chair said that she perceived lower oil prices to be a positive development for the U.S. economy on net.
In response to questions about when the Fed would raise the target federal funds rate, Chair Yellen said that it would likely occur sometime in 2015 and also mentioned “sometime after the next couple of FOMC meetings. This suggests that mid 2015 may bring a change, but Ms. Yellen repeated the Fed’s oft-stated position that continual review of economic conditions and developing trends would impact any decision to change or not change the federal funds rate.
Dec 17, 2014 | Home Buyer Tips
Every owner of condominium property automatically becomes a member of a homeowners association, otherwise referred to a “HOA” throughout the United States or a “Strata” in Canada. With that membership come certain rights and responsibilities. The primary right that the owner has is to vote at HOA meetings and elect board members. Responsibilities include payment of condo fees and assessments, compliance with association by-laws and rules, and maintaining a condo unit in conformity with those by-laws and rules.
Let’s take a quick look at various other terms you may hear about from your new HOA.
Declaration of Condominium and By-Laws
The declaration of condominium establishes the existence of a condominium property. It gives the precise location of the property through a legal description and describes each individual unit in the development along with the various common elements.
Individual Units
Ownership of an individual condominium unit is defined by the declaration of condominium and ordinarily consists of the interior walls and everything within the interior walls of a dwelling unit. Anything outside of that unit is usually considered to be a common element, such as the entryway, the swimming pool, the tennis courts, the parking lots and more.
Common Elements
This is property both inside and outside of buildings that the individual condo owner has an undivided interest in. It would include any common hallways, garages, parking lots, recreational facilities and open space on the property described by the declaration of condominium. If for example, there are 100 units in a condominium development, each individual unit has an undivided one percent interest in the common elements.
Running a Homeowners Association
Homeowners associations tend to operate like a small democracy. When matters are brought up at meetings to be voted on, each condo unit has one vote. Each HOA has an elected board of directors. They’ll meet once a month to decide on association business and make decisions on behalf of the HOA. The unit owners are permitted to be present at these meetings.
Owners’ Responsibilities Inside Their Units
Owners are responsible for any repairs within the walls of their dwelling unit. They might be responsible for damage to other units from leaks or flooding from a burst pipe. Depending on the by-laws, the unit owner might be responsible for maintenance or repairs of any pipes or electrical wires running behind their walls. The association is responsible for anything on the common elements.
Don’t let the purchase of your next home get derailed. If you’re thinking of getting started on condo shopping, your trusted, reputable and highly experienced real estate professional will guide you through your condominium purchase.
Dec 16, 2014 | Housing Market
Home Builder Sentiment slipped to a reading of 57 in December according to the National Association of Home Builders Housing Market Index. November’s reading of 58 prompted analysts to project a reading of 59 for December. The latest reading marks the sixth consecutive month for readings above 50. Any reading over 50 indicates that more builders are positive about housing market conditions than not.
The one-point decline in December’s reading kept the NAHB Housing Market Index within two points of a nine-year high reached in September.
NAHB: Housing Market Index Suggests Slow Return to Normalcy
NAHB’s chief economist, David Crowe, said that December’s reading was in line with NAHB’s assessment that housing markets are on a “slow march back to normal.” Home builder confidence in conditions contributing to the NAHB Housing Market Index also fell in two categories while remaining unchanged in one.
The gauge of builder confidence in current market conditions moved from last month’s reading of 62 to 61. Builder confidence in upcoming home sales fell from 65 to 64, while confidence in prospective buyer traffic was unchanged at a reading of 45. These results are consistent with real estate market trends slowing during the holiday season and winter months.
Builders Challenged in 2014, Better Conditions Expected in 2015
Analysts said that steady builder confidence may be a result of builders surviving a tough year in 2015. Market conditions, unpredictable interest rates and higher costs of supplies along with high unemployment subdued builder confidence during 2014. The New Year brings prospects of easing mortgage standards and better labor markets, which are expected to boost builder confidence as more home buyers enter the market for new homes.
The Commerce Department is set to release Housing Starts for November on December 16; analysts expect an increase to 1.035 million starts on a seasonally adjusted annual basis as compared to October’s reading of 1.01 million starts. A positive reading for housing starts could further bolster home builder confidence for future readings.
