May 24, 2012 5:46 am
Freddie Mac released recently its U.S. Economic and Housing Market Outlook for May showing for the most part encouraging signs with the release of several first-quarter 2012 economic indicators.
- Initial estimates for first-quarter 2012 economic growth was 2.2 percent, slower than the previous quarter, but better than three of the past four quarters.
- Personal consumption expenditures grew at a 15.3 percent annual rate reflecting continuing strength in consumer durables such as cars and kitchen appliances.
- Residential fixed investment like new housing construction and remodeling expenses have been a net positive contributor to growth for four straight quarters; however, it remains weak for this stage of the economic recovery compared with previous business cycles.
- Home prices at or near a trough in many markets bodes well for further declines in delinquency rates.
- Fixed-rate mortgage rates are the lowest in more than 60 years, providing extraordinary home-buyer affordability in many areas and likely translating into a sales pickup relative to last year.
According to Frank Nothaft, Freddie Mac, vice president and chief economist, "Taken together, the first-quarter data releases provide an encouraging sign for both the macroeconomy and the housing recovery. While not uniformly positive, for the most part the data trend in the right direction."
Published with permission from RISMedia.