![]() ![]() When asked if builders are “stealing” home sales from the future given the velocity of demand, Wolf says there is “no doubt” that the market has pulled demand forward, given the volume of millennials who are buying homes years earlier than they might have otherwise. In San Antonio, the three stimulus checks combined ($3,200) would make up 70% of a 3.5% down payment on a median-priced new home. At the same time, households are better able to save for a down payment, thanks both to the economic stimulus checks and student loan deferrals. While home prices and interest rates have risen steadily over the course of many months, the new-home affordability ratios for the major home markets remain higher now than they were in January 2020. Las Vegas has the highest middle tier sales rate, followed by Riverside/San Bernardino, California, and Denver, while Riverside/San Bernardino has the highest sales rate in the top tier, followed by Las Vegas and Sacramento, California. Las Vegas, Dallas, and Seattle also rank high on this list. Phoenix has the highest bottom tier sales rate by metro, meaning the highest concentration of homes sold in the bottom third of the new-home market’s price range. However, Jacksonville's new-home orders are only up 32%, illustrating the impact of outsized demand and low supply. Jacksonville has the highest YOY change in the Zonda New Home Pending Sales Index for large metros at 80%, followed by Chicago and Indianapolis. New-home sales are up by 35% YOY as of February-considering both the change in sales rate, which ties in supply and demand issues, and the change in total new-home orders. The economic rebound is “nearly complete” in some markets, led by Salt Lake City Jacksonville and Tampa, Florida and Nashville, Tennessee. Wolf says millions of jobs could return to this sector over the course of April and May, and reduce the unemployment rates in gateway markets. ![]() However, the jobs report shows a “start of a revitalization” for the bottom half of the K, with 355,000 jobs added in leisure and hospitality. Sales in retail and grocery have risen 17.9% and 14.6%, respectively, year over year, while transportation and entertainment have fallen 38.5% and 54.6%, respectively. The economy is still in a “K-shape” recovery, with certain industries performing better than others. This ratio has persisted through the second round of stimulus. Higher-income individuals saved a larger share of the stimulus -65%-while lower-income individuals spent a larger share, 62%. However, she does not expect this to occur any time within the next 12 months.Īnonymized card data available to the Federal Reserve Bank of Chicago shows approximately a 50% spend rate and a 50% save rate for the first round of stimulus checks. Wolf believes that as the virus recedes, economic risks may surface related to this stimulus volume in the long term. Across all three stimulus packages, the federal government has pumped $5.7 trillion into the economy in one year’s time. This comes alongside an “unprecedented” level of policy support to the economy, including the $1.9 trillion stimulus package and the individual stimulus checks. A number of states have partially or fully reopened, and approximately 15% of the U.S. Courtesy Adobe Stock/Andy Dean PhotographyĪt one year and one week since the very first COVID-19 Update webinar, "the economy is coming back to life,” says Zonda chief economist Ali Wolf. ![]()
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