Consumers looking for reasons to be confident are finding a mixed plate this week, with a volatile stock market and some pluses and minuses on other key economic indicators – the latest, housing and income trends.
One day after the worst drop since 2008 the stock market rallied up more than 400 points but far from erasing the losses many investors felt Monday.
"This is going to be an L-shaped recovery, the recovery is going to be slow, long, dragged out process," said Jack Suyderhoud of the UH Shidler College of Business.
The latest local housing numbers are along those lines, with the number of Honolulu homes sold down 7 percent in July compared to last July, and prices 2.2 percent lower.
Condo sales were down 8.3 percent in volume and 7.7 percent lower in price.
Pegging a trend in real estate has been tough.
"I think we’re bouncing up and down, and one of the things that’s occurring is the consumer confidence, and you saw that in the last week with the stock market and I think that’s carried over into the real estate market," said Joe Paikai of the Honolulu Board of Realtors.
But there is a bright spot – the homes that are on the market are selling quickly – about 34 days for houses, 37 for condos.
"That’s only a month from the time your home goes on the market to the time it’s placed into escrow, I think that’s great," Paikai says."It’s a great time to buy, that’s all I can say, and sellers are out there wanting to sell."
But a soft real estate market does have an impact on related jobs – with furloughs and cutbacks some industries.
"It’s a rippling effect, you have escrow companies, mortgage companies, and they’re all trying to hold their own, but it also affects the furniture companies, it affects the contractors," Paikai says.
"I’ve seen figures and estimates that say that the housing market nationally is not going to recover until 2014," Suyderhoud says.
In another economic indicator, personal income for the Honolulu metro area was up 2.4 percent last year, just under the national trend.
"If you take into consideration that there’s inflation maybe 1.5 to 2 percent inflation then really we’re not talking about any significant increase in personal incomes," Suyderhoud says.
See the original article at: KHON2 Local News
