LasVegasMove.com Team Leader
It is good to be back on track. Lots of great things happening in the Las Vegas real estate market;
Rates continue to be this weeks biggest story. After touching a high of 4%, the yield on the 10 yr treasury bill has dropped back to 3.78%. Until mid morning yesterday, it was looking like mortgage rates were going to continue to move up into the 6% handle. Fortunately some buyers stepped in yesterday and again today and the bonds are showing some resiliency. Trading demand at yesterday’s 30yr bond auction helped ease concern that international investors will slow purchases amid record U.S. debt sales and after release of this morning’s economic reports. Indirect bidders, an investor class that includes foreign central banks, bought 49% of the bonds on offer yesterday, the biggest percentage since 2006. Japanese Finance Minister said his country’s confidence in U.S. debt is unshakable. Japan is the second largest U.S. creditor with $687 billion behind China, with $768 billion. U.S. import prices rose 1.3% in May, for the third straight month and the largest increase since July last year.
Interestingly, foreclosure activity fell six percent in May, according to the U.S. Foreclosure Market Report released by RealtyTrac on Thursday. However, May marked the third straight month where the total number of properties with foreclosure filings exceeded 300,000.
Additionally, this week jobless claims fell 24K to 601K, fewer than forecast and the lowest level since January, from a revised higher 625K the prior week as businesses are slowing staff reductions. The improvement is clearly evident in the 4 week moving average, a less volatile measure, which fell to 621,750 from 632,250; its lowest level since February confirming global expectations that U.S. payroll contraction has peaked.
I think the message is that while the economy may not be out of the woods, we are certainly seeing substantial signs of improvement.
And to round it out with an alarming set of statistics I have seen in a while. 1 million option ARMs will reset higher in the next four years, with 750,000 adjusting in 2010 and 2011 and the peak coming August 2011 when 54,000 loans recast. The delinquency rate for payment option ARMs originated in 2006 is soaring to 42.44% from 23.26% in the last year. For 2007 loans, the rate went from 10.1% to 35.25% on loans 60 days or more past due. Whichever banks are holding this paper are certainly going to have another challenge shortly. They might want to reconsider returning the tarp money as they are going to need it.
Quick market check, stocks up as the Dow is at 8790, Gold is at 940/oz and oil has gone through the roof (up 100% since March) as inflation concerns are poking their heads up. Currently at $72/barrel (can you say $3/gallon gas… if you can’t now, you will soon.)
That’s it for now! I just wanted to get something up for those of you who have been asking for more.
Thanks!
David
