The media thrives on negative news, especially the financial media. Fortunately, not all of the economic news is doom and gloom. To boost your holiday cheer, here are some fun facts signaling that the economic recovery may be underway.
Pending Home Sales Jump to Nearly Six-Year High
The National Association of Realtors reported that the pending home sales index rose 5.2% in October. Importantly, that number is from when the results of the presidential election were unknown. Pending home sales are defined as a signed sales contract, so actual closing is usually one to two months later.
- This is the highest level of activity since March 2007.
- The Midwest led the country with a 15.6% increase.
In further good news, the excess supply of homes that built up before the housing crises has finally thinned out.
- Previously occupied home sales inventory is at a 10-year low.
- New home sales inventory is near the lowest level since 1963.
U.S. Business Spending Plans Improve
"Planned U.S. business spending increased in October by the most in five months." [Tweet this]
A major gauge of planned U.S. business spending increased in October by the most in five months. While the growth was modest, it may signal a slow recovery.
- Orders for non-defense capital goods excluding aircraft rose 1.7%.
Consumer Confidence Hits a Four-Year High
Consumers are growing increasingly optimistic about the job market and economic recovery.
- The Conference Board Index of Consumer Attitudes rose to 73.7, its highest level since February 2008.
Home Prices Boast Biggest Rise in Over Two Years
A combination of record-low mortgage interest rates, an improving job market, a five-year low in home foreclosures, and a tighter supply of both new and previously owned homes led to home prices posting the biggest percentage gain in more than two years.
- The closely watched S&P / Case-Shiller Index rose 3.6% in the third quarter.
- We recently saw the second straight quarter of year-over-year improvement.
- Single-family home prices rose for the eighth straight month in September, based on an index of 20 major metropolitan areas.
So shake off the doom and gloom and celebrate the holiday cheer. Optimism is an important psychological element in any economic recovery. Now that you know the facts you can do your share and spread the good word. Happy Holidays!
About Bruce J. Berno, CFP®
Bruce J. Berno, CFP® is the founder of Berno Financial Management, Inc. a fee-only comprehensive personal financial planning and investment advisory firm headquartered in Cincinnati, Ohio. Since 1993, Berno Financial Management has been helping individuals and families achieve financial peace of mind. For more information about Berno Financial Management, visit http://www.bernofinmgt.com.