Housing is 1 of the most important elements in the US economy as home construction and sales include firms in over 54 industries. When the housing market booms, sales of products related to homes rise significantly too.
The low mortgage rates have induced people to buy, but the rising prices are a warning that the market may be get too hot.
Nevertheless, we cannot ignore the positive data that shows people are willing to spend money, especially on big-ticket items.
Looking forward, we need consumers to keep spending.
While those who can and do work from home are mostly doing well, the number of people unemployed remains high. That raises questions about consumption of nondurable goods and services.
Services are about 66% of all household spending and it has been weak link. Since February, total consumption has declined about 7%. Almost 90% of that decliner was due to lower spending on services.
So, if you want to know if the consumer is coming back, you have to pay attention to services demand, and that requires all income classes getting going too.
The Big Q: How fast will that happen?
The Big A: Consumer confidence is rising on the prospect of Donald Trump being elected to a 2nd term.
Have a healthy day, Keep the Faith!