Home Sales Up, Consumer Confidence Steady, & the Fed meets Tuesday–Sunday, August 3, 2008

Interest Rates Likely To Hold Steady - The Fed meets August 5 and most market experts believe the weakness in the economy will keep the Fed from raising interest rates, an action that will probably be viewed as an admission that it is pretty powerless to do much about either problem right now. (CNN, 8/1)

In Brief:

• Homeownership is strongly related to age and socioeconomic status. The average age of first-time home buyers is 32, according to the National Survey of Families and Households (NSFH). Thirty percent of homeowners are under 31 years of age. Ownership peaks at 76.7 percent among those age 61 to 70, and then declines slightly to 68.5 percent for age 71 and older.
• Owners say they are happier and have higher self-esteem than renters, according to the NSFH.
• 86 percent of a national sample of Americans believe that people are better off owning than renting, according to the Fannie Mae National Housing Survey. (CAR)

C.A.R. REPORTS SALES INCREASED 17.5 PERCENT; MEDIAN HOME PRICE FELL 37.7 PERCENT IN JUNE - The median price of an existing, single-family detached home in California during June 2008 was $368,250, a 37.7 percent decrease from the revised $591,280 median for June 2007, C.A.R. reported. The June 2008 median price fell 4.3 percent compared with May's $384,840 median price. (CAR, 7/30)

CONSUMER CONFIDENCE HOLDS STEADY IN JULY - Consumer confidence held steady in July and now stands at 51.9, up from 51 in June, according to the latest Conference Board Consumer Confidence Index, which measures consumers' current outlook on the economy across a several business sectors and expectations for the near future. (CAR,7/30)

Mortgage Rates Drop – Freddie Mac says 30-year fixed rate fell to 6.52% with an average 0.7 point discount as the price of oil and gasoline fell this week. This is down from an average 6.63% last week, and down from an average of 6.68% recorded during the same week last year. The 15-year FRM averaged 6.07% this week with an average of 0.6 point, down from 6.18% last week, and down from 6.32% last year. Five-year adjustable-rate mortgages (ARMs) averaged 6.07% this week, with an average 0.6 point, down from last week when it averaged 6.16%. A year ago, the 5-year ARM averaged 6.29%. One-year ARMs averaged 5.27% this week with an average 0.6 point, down from last week when it was 5.49%. At this time last year, the 1-year ARM averaged 5.59%. (CNN, 7/31)

Prez signs Housing Bill - President Bush on Wednesday signed into law a sweeping housing bill that aims to boost the struggling housing market and bolster mortgage finance giants Fannie Mae and Freddie Mac. This bill was featured in last week’s blog at http://changhomesnews.blogspot.com/2008/07/housing-rescue-bill-on-presidents-desk.html. (CNN, 7/30)

McCain vs. Obama on Real Estate – second in a series summarizes the stance between the leading presidential candidates regarding topics associated with real estate:

Mortgage Giant Rescue – Both support efforts to stabilize Fannie Mae and Freddie Mac, but are otherwise vague. For greater details, check http://money.cnn.com/galleries/2008/news/0806/gallery.election_issues/7.html. Mortgage Fraud next week.

Fast Facts:

• Calif. median home price - June 08: $368,250(Source: C.A.R.)
• Calif. highest median home price by C.A.R. region June 08: Santa Barbara So. Coast $1,035.000(Source: C.A.R.)
• Calif. lowest median home price by C.A.R. region June 08: High Desert $180,570(Source: C.A.R.)
• Calif. First-time Buyer Affordability Index - First Quarter 08:44 percent (Source: C.A.R.)

Sources: California Association of REALTORS®, CNNMoney.