Outer Banks Real Estate

Thanksgiving Storm of 2006

We had another holiday storm on the Outer Banks last week.  One of those that an umbrella is useless because the rain hits you from the side and not the top.  A few local bloggers have documented what they saw with some pictures of the aftermath. 

Outer Banks Journal

Hatteras Island Real Estate Blog

Bill's OBX Beach Life - a windsurfers perspective

Mortgage Market Update

Last Week in Review

Helped by falling oil prices, America's trade deficit fell from an all-time high of $69 billion in August to $64.3 billion in September, a 6.8% improvement, the Commerce Department reported November 9. The $4.7 billion drop was the biggest one-month decline since February 2001. The politically sensitive deficit with China, however, rose to a new record of $23 billion, pushed higher by a flood of Chinese-made televisions, cell phones and toys being imported to stock American store shelves for the holidays.

Addressing the annual Charles Schwab Impact Conference on November 6, former Federal Reserve Chairman Alan Greenspan said that the current economic slowdown is "likely temporary" and that the worst of the housing market slump is past. "It is no longer subtracting from [gross domestic product] growth," he added.  

Rates on 30-year, fixed-rate mortgages edged up slightly for the week ending November 9, Freddie Mac reported the same day. Rates have seesawed within a narrow range the past six weeks.

For the week ending November 3, the Mortgage Bankers Association's (MBA) Market Composite Index -- a measure of mortgage loan application volume -- increased 8.8% to a seasonally adjusted basis of 620.9 from 570.8 one week earlier. 

The Labor Department reported that 308,000 laid-off workers filed for unemployment benefits, down from 328,000 in the previous week. The drop of 20,000 exceeded the decline of 12,000 that many economists were expecting, and showed that the labor market is so far withstanding the overall economic slowdown.

As for the local economy, the first annual Outer Banks Marathon was held last weekend with 4,000 runners participating from across the country.  Most organizers were pleased at their first try at organizing a marathon and the community was very pleased with the off-season dollars spent. 

Mortgage Market Update

Last week in the news

The U.S. unemployment rate unexpectedly fell to a five-year low of 4.4% in October from 4.6% in September, even though the economy created fewer jobs in October than in any month in the past year, the Labor Department reported November 3. There were 92,000 new jobs created in October, fewer than the 125,000 new jobs economists had expected.

U.S. worker productivity -- the amount of output per hour of work -- showed no change in the July-September quarter, while labor costs rose by 3.8%, the largest quarterly rise in more than two decades, the Labor Department reported November 2. For the past year, labor costs are up by 5.3%, the fastest increase since 1982, which is likely to raise inflation concerns at the Federal Reserve.  As I have mentioned in previous posts, mortgage bonds react negatively to inflation which causes higher interest rates on primary mortgages.  The Federal Reserve also reacts to inflation by raising the fed rate which directly affects second mortgages, car loans and some credit cards. 

Construction spending fell 0.3% in September as home building declined for a sixth consecutive month, the longest stretch of weakness in residential construction in more than a decade, the Commerce Department said November 1. The decline was the largest since a 0.7% fall in July.  

Consumer confidence in the economy slightly weakened from 105.9 in September to 105.4 in October, the Conference Board reported October 31. Analysts had expected a reading of 107.8. Economists cited worries over job losses at auto plants and other manufacturers for the decline.

Orders to U.S. factories for manufactured goods rose by 2.1% in September, the biggest increase in six months, the Commerce Department reported November 2. Excluding a surge in demand for commercial aircraft, factory orders would have fallen 2.4%.  

This week look for updates on the trade balance on November 9.