The Bureau of Economic Analysis will release the second of three estimates for the nation's first quarter GDP growth on Friday, May 27. In the advance estimate for the first quarter released in late April, the BEA reported GDP growth to be a weak 0.5 percent. GDP growth has been weak for the last several first quarters; last year, it came in at 0.7 percent.
Housing experts have downwardly revised their economic forecasts for the full year of 2016. Last week, Fannie Mae announced its forecast for GDP growth for the year was now 1.7 percent, down from 1.9 percent the previous month and from 2.2 percent at the beginning of the year. Also last week, Freddie Mac revised its GDP forecast for the full year from 2.0 percent down to 1.8 percent.
New Home Sales- Tuesday, May 24, 2016
It's no secret that inventory is on the scarce side in the housing market, which is causing a domino effect of issues for homebuyers trying to purchase a home. The mortgage industry is now anticipating where new single-family home sales will fall for April after coming up short the month before.
According to data estimates from the U.S. Census Bureau and HUD, new single-family home sales in March 2016 were at a seasonally adjusted annual rate of 511,000, down 1.5 percent from the revised February rate of 519,000. However, new home sales are up 5.4 percent from the March 2015 estimate of 485,000.
On the upside, inventory looked promising in March, reaching the highest level since September 2015. The number of homes for sale in the U.S. rose month-over-month and year-over-year.
The seasonally adjusted estimate of new houses for sale at the end of March was 246,000, which represents a supply of 5.8 months at the current sales rate. In February, inventory stood a 241,000 (5.6 months supply), and last March, inventory was at 205,000 (5.1 months supply).
"Persistently low inventory of existing homes is making it difficult for homebuyers to find properties to buy, and pushes prospective buyers away from existing homes towards new homes. This allows builders to sell more new homes that haven’t yet been built," said Ralph B. McLaughlin, Chief Economist at Trulia.
Here is the lineup for the week:
Tuesday, May 24
New Home Sales, National Association of Realtors, 10 a.m. EST
Wednesday, May 25
House Price Index, Federal Housing Finance Agency, 9 a.m. EST
Thursday, May 26
Jobless Claims, Bureau of Labor Statistics, 8:30 a.m. EST
Pending Home Sales Index, National Association of Realtors, 10 a.m. EST
Friday, May 27
GDP, Second first quarter estimate, Bureau of Economic Analysis, 8:30 a.m. EST