Homes on wheels
Is the housing market finally starting to move? Maaaybe. But there are some qualifiers, which we should discuss. There is a segment, though, that’s moving for sure.
According to the Case-Shiller index, home prices in 20 cities rose in July by the most in four years. From Bloomberg:
Home prices are “a major, major turning point for the economy,” said Bethune, chief financial economist at IHS Global Insight in Lexington, Massachusetts. “We are eating away at the problem of household balance sheets.”
Not so fast, says thestreet.com:
Prices have risen in all of these surveys for several months through July. Some cracks in this trend have appeared with new data out in the past week. Going into the weak seasonality of the fall and winter, it is definitely not the time to declare that home prices have bottomed.
The first time home buyer tax credit gets some of the uh, credit for the latest boost. But it runs out in two months. Unless the credit gets extended, buyers who haven’t taken advantage by now, probably don’t have time to at this point.
But the credit hasn’t really done what it was supposed to do, as real estate guru Barbara Corcoran explained on the Today Show:
Now, for the segment that is moving: wholesale shipments of motor homes jumped 16% last month. The adjusted annual pace is up 136% from January. Some economists see this a sure-fire sign of renewed economic vitality. Others, not so much. From USA Today:
“It would suggest the worst of the (stock market) decline seems to be over, and the consumer is in a position to come back,” says Indiana economist Morton Marcus, who studies the RV market.
Manufacturer Airstream has boosted production 30% the past six weeks. Keystone RV is hiring 200 workers to fill added demand.
Some economists put less premium on RV sales. Wells Fargo’s Mark Vitner says buyers are likely retirees who deferred purchases, a trend that won’t extend to other big-ticket items, such as cars.
Perhaps some of the RV industry is being supported by financially struggling airline pilots. Check out this story about an RV colony of airline workers at Los Angeles International Airport:
More on the “RV Index” tonight on Marketplace.
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