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Friday, August 19, 2022

Home sales increase in May, ending a 6-month losing streak

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The National Association of Realtors reported on Monday that pending home sales rose a surprising 0.7%, breaking a six-month losing streak as the Northeast saw an uptick. Big swings in activity, the National Association of Realtors reported Monday.

Sales picked up, reflecting signed home purchases, after falling 3.9% in April and still driving year-over-year activity down 13.6%.

“Despite the small increase in pending sales from last month, the housing market is clearly going through a transition,” said NAR chief economist Lawrence Yun. “Contracting has dropped significantly from a year ago because of much higher mortgage rates.”

Even with the rise, the data is evidence that the housing market is cooling, as higher mortgage rates and record prices have slashed the affordability of homes for many. buying.

Yun notes that the monthly mortgage payment on a median-priced single-family home with a 10% down payment has grown by about $800 this year alone.

Political cartoons about the economy

“Trying to balance the housing market by dampening demand through higher mortgage rates is taking a toll on consumers and the economy,” Yun added. “The better way to balance the market is through increasing supply, which also helps the broader economy.”

But that is unlikely with the Federal Reserve committing to a policy of raising interest rates to stem inflation, which currently stands at 8.6% annually. And with layoffs underway in key industries like finance and technology, many business leaders and economists are predicting a recession within the next 12 to 24 months.

A JPMorgan survey of business leaders released on Monday found that less than a fifth feel optimistic about the economy.

“Only about a fifth of business leaders (19%) say they are optimistic about the national economy next year, the lowest percentage recorded in 12-year survey data and down from 75%. a year ago,” JPMorgan Chase’s 2022 Business Leaders Pulse Survey found. “Along with this diminished outlook, pessimism around the national economy has increased to 51% from 10% a year ago.”

The main problems businesses face are inflation and finding workers.

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I am passionate about journalism and using new technology to spread news. I am also interested in politics and economics, and I am always looking for ways to make a difference in the world. I am the CEO of Janaseva News, and I am 24 years old.

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