THE Leading Indicator for the Real Estate Market
Consumer confidence is the best leading indicator of the local and national real estate markets.
When the index rises the number of sales rise and inventory of homes for sale falls. When the index falls, the reverse happens.
The Conference Board just released their latest report indicating a slight rise in the index from 50 to 51.1 http://www.conference-board.org/utilities/pressDetail.cfm?press_ID=3836. Historically, the Board considers a reading of 80 to represent a good, stable economy, while a reading of 100 or more indicates a growing economy.
Obviously we are a long way from an indication of a good economy, which is why we believe the stock and real estate markets are likely to surprise to the downside later this year.
Home sellers who are planning a 2010 sale should go to market as soon as possible. Home buyers who are not at risk to rising interest rates may want to exercise patience.