September 28, 2011
Carrick: Outlook deteriorates for U.S. residential real estate
Consumer confidence in the U.S. has taken a hit, and sales of new single-family homes south of the border dropped from 302,000 units in July to 295,000 units in August.
According to the S&P/Case-Shiller resale home price indices, prices dropped sharply in Minneapolis, Phoenix, Portland, Chicago, Seattle and Tampa.
Of the metro areas covered, S&P/Case-Shiller reported prices only rose in Detroit and Washington, D.C.
For more analysis of the real estate prices on both side of the border please see Pre-emptive warnings about home equity lines of credit (HELOCs) by Alex Carrick, chief economist, Reed Construction Data Canada.
Carrick analyzes the latest figures in the context of home equity lines of credit.
Although Statistics Canada’s new home price index was up 2.3 per cent year over year in July, Canadians may be vulnerable is if they up their home equity loans to pay for personal expenditures under duress. The picture could turn ugly if home prices in Canada drop.
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| ALEX’S ECONOMICS BLOG |
Reed Construction Data Canada’s Chief Economist Alex Carrick discusses current developments in the North American economic environment with emphasis on the construction industry.
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