National home construction report bodes well for Boston buyers
Real estate in Boston is part of a relatively stable housing market, but inventory levels are down, and demand is on the rise. Fortunately, new reports suggest that the national real estate market is on the mend and that homes are being built at a rapid pace.
U.S. stock futures are mixed as a new round of earnings from corporations like Bank of America, PepsiCo and Halliburton report their most recent earnings. The Dow Jones industrial futures are up 9 points to 13,462, The Boston Globe reports, and the S&P futures added an additional 2.8 points to total 1,452. The latest reports came just hours before The Commerce Department released its latest housing study, which many experts expect will show positive construction growth in September 2012.
Bank of America (BOA), for example, reported that mortgage originations increased by 18 percent year-over-year to $21 billion, the Boston Globe reports. Unfortunately, the Bank still lost money in the mortgage unit as it worked out post-crisis issues related to the economic collapse in the late 2000s.
The recent report from BOA is the latest sign that residential financing still drive serious revenue, but banks are getting hit with various reminders that services like mortgages are risky practices.
"I think we've clearly begun to turn the corner," Bank of America's Chief Financial Officer Bruce Thompson said to the news source. Bruch echoed what companies like JPMorgan Chase and Wells Fargo, two large mortgage lenders, suggested in their reports last week.
In addition for favorable reports released by BOA and PepsiCo and positive futures gains, U.S. builders started construction on homes in September 2012 at the fastest rate since July 2008. The gains show the housing recovery is picking up steam and could help grow the economy.
The Commerce Department said that home construction increased 15 percent in September 2012 to a seasonally adjusted annual rate of 872,000. In the U.S., single-family home construction starts grew 11 percent to the fastest rate in four years and apartment construction improved 25.1 percent.
What's more, upticks in home construction are projected to continue moving forward. Applications for building permits, an obvious sign of future construction, jumped about 12 percent to an annual rate of 894,000, the highest measured mark since July 2008.
The latest housing report could play a crucial role in the November presidential election, the future of the U.S. economy and the volume of new homebuyers looking for property in metro areas like Greater Boston.