Daily Archives: January 22, 2013

Treasury 10-Year Yields Fall Amid Decline in Home Sales | Bedford Corners Realtor

Treasuries rose, pushing 10-year note yields down from almost the highest level in a week, after sales of U.S. existing homes unexpectedly dropped in December to cast doubts on the strength of the real-estate recovery.

The benchmark yield dropped as home sales were restrained by the lowest supply of properties in more than a decade. Yields rose earlier as inflation expectations increased to the highest in almost three months before the U.S. sells $15 billion in inflation-indexed debt this week.

“The housing figure was disappointing,” said Ray Remy, head of fixed income in New York at Daiwa Capital Markets America Inc. “People are starting to spend much more time wondering and worrying about the U.S. economy. That’s why we’ve had an uptrade.”

The 10-year yield fell one basis point, or 0.01 percentage point, to 1.83 percent at 3:04 p.m. New York time, according to Bloomberg Bond Trader prices. It rose earlier four basis points to 1.88 percent after touching 1.89 percent on Jan. 18, the highest since Jan. 11. The 1.625 percent note due in November 2022 rose 2/32, or 63 cents per $1,000 face value, 98 4/32.

Treasuries handed investors a 0.4 percent loss this month through yesterday, while bonds in an index of sovereign debt around the world declined 0.2 percent, according to Bank of America Merrill Lynch data.

Home Sales

Purchases of existing U.S. homes fell 1 percent to a 4.94 million annual rate last month, figures from the National Association of Realtors showed today in Washington. The median forecast was for an increase to a 5.10 million annual rate last month, according to the estimate of 69 economists surveyed by Bloomberg.

A weaker existing-home-sales report “puts a little curve ball into the mix, given how the data have been decent,” said Justin Lederer, an interest-rate strategist in New York at Cantor Fitzgerald LP, one of 21 primary dealers that trade with the Federal Reserve. Yields have been “at the top end of a tight range.”

Yields show inflation expectations in the U.S. are rising before the U.S. auctions the Treasury Inflation Protected Securities on Jan. 24.

The U.S. previously sold $13 billion of the securities on Nov. 21 at a yield of negative 0.72 percent, compared with the record-low yield of negative 0.75 percent at the September auction. The last six note sales since January 2012 have drawn negative yields.

Fed Buying

The difference between rates on 10-year notes and similar- maturity TIPS, a gauge of expectations for consumer prices over the life of the securities, widened to as much as 2.55 percentage points today, the most since Nov. 2. The average over the past decade is 2.19 percentage points.

The Fed is purchasing $85 billion of government and mortgage debt each month to spur the economy by putting downward pressure on bond yields. It bought $1.39 billion of TIPS maturing from April 2017 to February 2042 today as part of the program.

Yields on the 10-year note are forecast to rise to 2.2 percent by year-end, according to economists in a Bloomberg News survey.

“This 1.89 percent level will be tested, but should hold today,” said Thomas di Galoma, a managing director at Navigate Advisors LLC, a brokerage for institutional investors in Stamford, Connecticut. “However, if we test it again, we could break to higher yields. That’s the pivotal level.”

Bonds in an index of riskier debt yielded 4.88 percentage points more than Treasuries on average, the smallest spread since May 2011, Bank of America Merrill Lynch data show.

The MSCI All-Country World Index (MXWD) of shares gained 17 percent last year including reinvested dividends, according to data compiled by Bloomberg. Treasuries returned 2.2 percent and investment-grade corporate bonds gained 10 percent, Bank of America data show.

 

 

Home prices spike 19.4 percent in Chicago in December | Armonk Realtor

Median home prices in the city of Chicago shot up 19.4 percent in December from a year earlier, and sales of existing homes jumped 14.6 percent, according to the latest report from the Illinois Association of Realtors.

The median price rose a smaller 4.5 percent in the Chicago metropolitan area, and sales spiked 19.2 percent.

 

The report showed the median price in the city rose to $185,000, in December, up from $155,000 in the year-ago period. There were 1,806 homes sold, up from 1,576.

In the Chicago metropolitan area, the median price rose to $151,500 last month, up from $145,000 in December 2011. Home sales totaled 7,372, up from 6,184.

“Positive signs for the housing market continue,” Geoffrey Hewings, director of the Regional Economics Applications Laboratory at the University of Illinois, said in a statement.

“The housing market is likely to experience some bumpiness in the first quarter of the year until there is resolution of the fiscal challenges in Washington and Springfield.

Consumers are unlikely to explore major purchases, such as a home, when tax rates, mortgage interest deductions and pension obligations remain unresolved, he added

 

4 Reasons Why Online Video Is Compelling & Persuasive | South Salem NY Real Estate

Why is online video so compelling compared to text?

I’ve been in my video studio working on my new online video course (Designing For Engagement). It’s a lot of work to create my online video courses (through Udemy.com), but it’s also fun to work on them, and it’s exciting to have people taking and enjoying the courses.

It got me thinking again, about why online video is so compelling as a medium, and so while I was in the studio I made this short video “4 Reasons Why Online Video Is Persuasive”:

 

 

Here are the 4 reasons:
#1: The Fusiform Facial area makes us pay attention to faces
#2: Voice conveys rich information
#3: Emotions are contagious
#4: Movement grabs attention

What do you think? Do you find online video more engaging than reading text? Why do you think it is (or isn’t)?

 

Las Vegas new home sales jump 42% | Bedford Real Estate

The Las Vegas housing market improved last year, but the road to full recovery remains a long one, a new report says.

There were 5,544 new home sales in the Las Vegas Valley in 2012, up 42 percent from a record low in 2011, according to Home Builders Research.

 

Home values appreciate 5.9% in 2012 | Cross River Real Estate

1/21/13 2:33pm

U.S. home values ended 2012 up 5.9% over the end of 2011, Zillow ($33.21 0%) reported when covering national home value appreciation.

Zillow’s home value index also hit $157,400 in the fourth quarter, up 2.5% from the quarter before.

The nearly 6% annual appreciation rate was well above the typical appreciation in a healthy market and represents the largest annual gain since 2006.

“We expected 2012 to be a good year for housing, and it delivered in spades,” said Zillow Chief Economist Dr. Stan Humphries. “Strong demand paired with limited inventory in many markets helped fuel a robust and often rapid recovery in overall home values, good news for homeowners after years of poor performance.”

Based on previous reports, annual home value appreciation is roughly 3% on average, according to Zillow.

Cincinnati and Chicago were the only metros of the 30 largest covered by the report that did not show quarterly increases in the fourth quarter.

Phoenix hit 22.5% year-over-year appreciation. Seven of the top 30 metros registered annual home value increases of at least 10%.

Click on the table below to see Zillow’s full home value index.

 

 

Looking into 2013, Zillow predicts home values will increase by 3.3% in 2013, much closer to historic norms.

“We expect this recovery to continue into 2013, but at a more sustainable pace,” said Zillow Chief Economist Dr. Stan Humphries.

“It’s important to be cautious moving forward, even as we celebrate the undeniably positive end to 2012, and be careful that consumers don’t grow to expect such high appreciation as the norm. Buying a home should be a long-term decision, and these swings between a deep housing recession and higher-than-normal appreciation rates can give consumers whiplash and cause some to lose sight of that.”