Las Vegas Market Watch Blogs

OCTOBER SUMMARY

October 31, 2022
By John Ahlbrand, CRS®
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  • November is upon us, and the autumn landscape is decidedly more colorful across the country. The economy expanded in the third quarter even as inflation continues to weigh on businesses and consumers.
  • The 1st estimate of third quarter real GDP came out this week, and it showed that economic activity rebounded after two quarters of declines. The increase in GDP was driven by higher exports, consumer spending, business investments, and federal government spending.
  • Meanwhile, orders for durable goods rose in September, the sixth increase in the last seven months, fueled by solid orders for commercial aircraft. On the private business side, orders were more mixed, with cars higher, and computers and appliances lower.
  • While recession worries continue to deepen for companies, labor market conditions remain tight. Both initial and continuing jobless claims rose, but the levels are still low, a sign that companies still have more open positions to fill and are reluctant to lay people off.
  • With a growing economy, prices continue rising at a fast pace. The gain in the August personal consumption expenditure price index—the Fed’s preferred inflation measure—was driven by double-digit jumps in food and energy prices. Even excluding those, prices moved higher, signaling that another rate hike from the Federal Reserve is on the table at the next meeting.
  • With worries of a recession adding to the pressures of inflation, the consumer confidence index dropped in October for the first time in three months. With everyday expenses rising faster than most people’s wages, households are feeling financially squeezed from all directions.
  • This squeeze is plainly evident in real estate markets, as well. Mortgage rates jumped again this week, with the Freddie Mac 30-year fixed rate crossing the 7% threshold for the first time since 2002. With prices up 14% from last year and rates about 400 basis points higher, the monthly payment for a median-priced home shot up a stunning $1,000 in the last 12 months. With their ability to finance a home purchase severely curtailed, homebuyers are pulling back.
  • Sales of new homes dropped in September as prices remained high, and builder cancellations mounted.
  • At the same time, contract signings for existing homes dropped to the lowest level since June 2010.
  • The contraction in transactions is also reflected in prices. Two widely tracked measures of home prices showed monthly declines. While prices are still higher than a year ago, there is a clear downward trajectory in momentum.
  • This was also mirrored in Realtor.com’s weekly data. With fewer people able to afford a home, inventory is growing even while sellers are pulling back, and homes are spending longer on the market.
  • Stay well as we move into November.
  • You’ll find daily blogs and details to help you navigate these market shifts along with our monthly Las Vegas Market Watch. Check us out for all the Las Vegas Real Estate Market Available Homes. CLICK HERE FOR AVAILABLE HOMES

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October 31, 2022
By John Ahlbrand, CRS®