Recap 9-11-13


Note that home prices are now quite rich vs income. By my calculations, the ratio of Median Home prices to Median Household income is now back to 2004 levels:

With interest rates still fairly low on an absolute basis, this can certainly persist. Consensus forecasts for home prices are for low to mid single digit appreciation next year – lower than the double digit returns this year, but still higher than income growth is likely to be. I think it’s worth noting that housing is now only “affordable” because of low interest rates. And with the private equity bid easing, and mortgage purchase applications still weak, there may be downside risks from housing next year.


  • UK ILO Unemployment declined to 7.7% vs 7.8% exp and prev. The Claimant Claimant count rate also declined.

Upcoming Data:

  • Wed: Australia Employment,
  • Thu: US Jobless Claims, USDA WASDE
  • Fri: US Retail Sales, UMichigan Confidence
  • Mon: US Empire Mfg, Canada Existing Home Sales
  • Tue: UK Inflation, German Zew, EU Trade Balance, US NAHB Survey, TIC flows