Daily Economic Update for February 24, 2011

Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update, highlighting jobless claims and the FHFA house price index, is after the jump.

• The report on new jobless claims shows another week of significant improvement in the labor market, with new claims falling 22,000 to 391,000. This brings the 4 week average to 402,000 and is a 30,000 claims improvement over levels of a month ago. As we mentioned previously, falling under 400,000 would mean more jobs are being created than being lost, thus signifying improvement in the job market and a decrease in the unemployment rate.
• Continuing claims also fell considerably, down 145,000 to 3.790 million. The four week average is down 55,000 to 3.893 million for an 87,000 improvement over a month ago level. There had been 984,000 net new job additions in the past 12 months from January. Assuming that the jobless claims continue to trend down, NAR expects about 1.5 to 2 million net new jobs in the next 12 months.
• Sales of new single-family houses in January 2011 were at a seasonally adjusted annual rate of 284,000. This is 12.6 percent decrease from December and 18.6 percent decrease from January of last year. The median sales price of new houses sold in January 2011 was $230,600, 1.9 percent decrease from the month before, but 5.7 increase from January of last year. There were 188,000 new homes available for sale which represents 7.9 months supply at the current sales rate.
• The NAR existing-home sales data released yesterday showed increase in activity with first time in seven months that sales activity was higher than a year earlier. However, this was largely due to purchases of distressed properties.
• Separately, The FHFA purchase-only house price index declined 0.3 percent in December, and 0.8 percent in the fourth quarter 2010. Over the past year, the FHFA HPI is down 3.9 percent from the fourth quarter of 2009 to the fourth quarter of 2010. The HPI declined in the fourth quarter in 35 states and the District of Columbia, while prices rose in 15 states.