Thursday, June 7, 2012

Views You Can Use - June



IN THIS ISSUE...  






Summer...summer...summertime. In his hit song, Will Smith paints summer as a break from monotony and the norm. And as we head into June, we're seeing a break from monotony in the markets...but in some instances that break can be a double-edged sword. Read on to see what's changed...and what it means!
  • Home Sweet Home – Here's what you need to know about the direction of home prices and the housing market!
  • What to Watch – The Euro drama is getting ugly! Find out what's going on and what it means to the US economy and home loan rates.
  • 10 Fun Ideas – Keep your family active this summer with these fun and inexpensive ideas.
  • Q&A: Are You Covered? – This is one of the most important questions facing homeowners, but it's often overlooked!
Here's to the start of a happy summer. Remember, if you have any questions or would like to discuss your unique situation, call or email today. And please forward this newsletter to friends, family members and coworkers who may find this information helpful.





Home Sweet Home  








The housing industry received some good news last month that showed signs of some stability, if not improvement. 

Last month we saw New Home Sales released for the month of April, and the new data showed an increase over the previous month's data. As you can see in this chart, the number of New Home Sales was up from the previous month's number. Better still, over the last 3 months, New Home Sales are up 14% over the same period last year.

The New Home Sales report is closely watched because it shows the number of newly constructed homes with a committed sale during the month. The level of new home sales indicates housing market trends and indicates housing demand. The data is timely and is used in conjunction with the Existing Home Sales release from the National Association of Realtors. 

Speaking of Existing Home Sales, last month's data also showed a rise compared to the previous month. According to the report, Existing Home Sales increased 3.4%. Although market analysts were hoping for a larger increase, the news was still good in that it showed an improvement over the previous month, which means the housing market is at least moving in the right direction.
Housing sales aren't the only thing to see an increase last month. Last month's housing news showed that Housing Starts also increased. According to the report, there was a 2.5% increase in housing starts during the month of April. The flip side, however, wasn't as rosy for Building Permits, which fell 7%. The decrease in building permits should temper the excitement and keep expectations realistic for the housing market. 

Despite all that news, many homeowners and homebuyers are focused mainly on home prices...and there was news last month of a rise on that front, too. Recently, the Federal Housing Finance Agency (FHFA) reported that national home prices rose a modest 0.6% during the first quarter of this year, which is the first price gain since 2007. And, year-over-year prices gained 2.7% for the first quarter. That's not a huge increase and not every state saw the same increase, but it's a start.
The bottom line is that the housing market won't bounce back over night, but there are some positive signs for the future.
Now continues to be a great time to purchase or refinance a home, and home loan rates remain near historic lows. Let me know if I can answer any questions at all for you or someone you know.






What to Watch: News Out of Europe  








This month, we focus on news reports (rather than economic reports) that will shape the markets and home loan rates in the coming weeks. That's because the Euro drama is getting ugly and the time table for an ultimate resolution is getting pushed up more quickly than politicians would have liked or hoped. There is a saying that markets move faster than politicians can debate.
Speaking of debate, we saw an open dialogue last month about Greece possibly exiting the Euro, and former Greek Prime Minister Papademos even said the risk of Greece leaving the Euro is real. That dialogue prompted at least half of EZ governments (as well as banks and large companies) to make contingency plans in case Greece does decide to leave the single currency area. But the preferred option is still for Athens to keep the Euro.

Despite Germany reaffirming that it will not support a Euro Bond to help contain the crisis, there is optimism that the EuroZone (EZ) officials will contain the problems in Greece from spreading to other troubled nations. In order to get their arms around the problem, at least in the short-term, the European Central Bank (ECB) could commit a large amount of money. Firing up the printing press doesn't make the problems go away (after all, you can't fix debt with more debt), but it would give the EZ more time to tackle the fiscal integration and the lack of trade competitiveness within the EZ.

Although there is a litany of scenarios that could take place in the near future, one thing that is a real concern is a continued run not only on Greek Banks but also a spreading contagion into banks of other troubled countries like Spain and Italy. In the case of Spain - where bank recapitalization efforts are already challenged - a Greek exit could bring into question Spain's viability in the Euro. And if people start to draw their capital out of these troubled banks, it would be a real big problem, and the ECB would be forced to guarantee deposits so investors don't flee.

Remember, it's a small, small world. Economic turmoil half a globe away can still impact Stocks, Bonds, and home loan rates here in the US. When there is a lot of risk and concern out in the market, Traders seek a safe haven like the US Dollar and US Bonds...and we've seen the drama and risk in Europe benefit US Bonds and home loan rates a number of times in recent weeks. But the benefit to Bonds and home loan rates can also signal potential concerns for the economy as a whole. In fact, just the other week, the White House said that the EuroZone crisis remains a headwind for the US economy.

The financial trouble of Greece and other European countries has been in the news for a while, but this story is now more important and influential than ever. So this will continue to be one of the hottest news stories to watch in the weeks ahead. 

I'll continue to monitor this news story to see how it impacts the markets and home loan rates. If you have any questions, please call or email.






10 Fun Ideas to Stay Active This Summer  








When kids dream of summer, they dream of school ending...of staying up late...and of sleeping in. But they also dream of spending entire afternoons playing video games or watching television.
In fact, on average, children spend nearly 3 hours out of every day watching TV. An even more alarming statistic is that only half of kids between ages 12 and 21 exercise regularly.

Now that the regular exercise of gym class has been removed from your child's schedule, it's even more important that you incorporate exercise at home. And summer is the ideal time to start an exercise routine that the whole family can enjoy and take part in. That's because regular exercise can help kids:
  • Control weight and body fat
  • Build healthy bones, muscles and joints
  • Reduce the risk of high-blood pressure, diabetes and heart disease later in life
  • Fall asleep quickly and sleep better
  • Reduce anxiety, tension and pessimism
  • Increase confidence and self-esteem
  • Gain a better handle on the emotional and physical challenges in life
  • Foster teamwork, leadership and friendships
10 Ideas You Can Do Today
1. Swim. Water naturally goes with the summer months. After all, summer is hot, and the water is cool. But instead of splashing around, encourage children to race one another or to try to beat their own time. You can even form a neighborhood swim club - so children will be engaged with their friends, while parents take turns car-pooling.
2. Walk or jog. Yep, it's that simple. Walk the dog with your children every morning. Jog with them every evening. Walk or run with them in a charity event. The point is to get children involved in regularly moving their bodies.
3. Play soccer. Talk about improving endurance! Soccer is a great way to help children build friendships, learn teamwork, increase confidence and just plain have fun during summer. And, it's inexpensive--all you need is a patch of grass and a ball.
4. Bike. Kids love to bike. So why not encourage it? Parents can get children out and exercising by biking for fun or even biking to the store. In addition to exercise, children can learn safety lessons and the rules of the road. Not to mention that it's a great way for parents and children to spend dedicated time talking and laughing.
5. Shoot hoops. Basketball is another inexpensive sport that provides children with the opportunity to work on endurance, teamwork and friendships. Chances are there's a park near you with some hoops that you can easily drive to...or better yet, bike or walk to...a few times a week. Parents can get involved in a full-court competition with the neighborhood kids or just a fun one-on-one game of HORSE.
6. Mow the yard. If you have older children or pre-teens, you can teach them responsibility while encouraging exercise by hiring them to mow the yard every week during the summer.
7. Just dance. It doesn't matter what kind of music or dancing style you're into, moving your body is great exercise...and it's fun! Parents and kids can even dance together to teach each other their favorite moves and share their favorite songs. It's a great way to bond with children while staying healthy and fit.
8. Jump rope. It's easy to do, inexpensive, fun and a great workout. Better still, children can jump rope by themselves or in groups. And it's a great way to improve stamina and coordination.
9. Skate. Inline skating is fun for children and adults alike. Make sure you wear the proper safety equipment and model safe practices near roads. Of course, if you're looking to cool off this summer, you can look for indoor skating rinks in your area. Ice-skating, figure skating and hockey camps are actually more popular during the summer than most people think.
10. Make an obstacle course. Obstacle courses are a great way to work every aspect of physical fitness. You can add climbing obstacles, incorporate running or jumping roping, and even include stages where children have to reach for items or touch their toes a certain number of times before proceeding to the next stage. And the best part is, you can switch the course up to keep children from getting bored or to include children of different ages and capabilities. So gather up some items from around the house and get your children's creative minds working on an obstacle course in your yard.
Don't forget to keep it fun to encourage consistency! And remember to model physical fitness for your children. Studies show that children are more likely to be physically active if they see their parents and role models engage in regular physical exercise.
Have a safe, healthy and fun summer!







Q&A: Are You Covered?  








QUESTION: Is your home covered in case of a tragedy or emergency?
ANSWER: One of the most important questions that homeowners face is: Do you know what your policy does, or more importantly, does not cover?

You may be surprised to find out what types of damage aren't covered by the typical insurance policy. A study released by the National Association of Insurance Commissioners pointed out that typical property and liability policies do not cover home damage from floods, earthquakes, water line breaks, termites, mold, and several other perils, large and small.

Mortgages and home equity are important parts of every homeowner's financial plan - so proactive planning and protection are essential! Don't wait until after a tragedy happens to learn exactly what type of coverage you have. Then, it may be too late to protect yourself, your home, and your financial future.











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