The Federal Reserve released their Beige Book last week which provides anecdotal comentary on the state of the economy from the 12 regional banks. While it doesn’t provide stats, in many ways its a better way to understand how elements of the economy are unfolding. Here is the release schedule. It provides a national summary and specific behaviors in the member regions.
Nearly all Districts reported that housing market conditions continued to soften, though several noted that activity increased in some markets. Most Districts reported higher home inventories, and several said that homebuilders and sellers continued to offer incentives to attract buyers. Softer home demand in San Francisco led to layoffs for mortgage brokers and real estate agents. Residential construction remained weak in the St. Louis and Minneapolis Districts except in western North Dakota where residential construction was described as “robust.” New home inventories inched up in the Dallas District despite strong demand in some of its markets and inventories of single family homes and condominiums rose sharply in the Boston District.
New York and St. Louis reported mixed housing activity. On the upside, Manhattan condominium sales showed signs of resilience, and housing sales rose in Memphis, but both Districts noted weakness in most markets. Richmond reported generally weaker housing activity, but also noted increases in some markets. Atlanta said that housing activity rose in its Mississippi Gulf market, and Minneapolis’ Sioux Falls market remained on pace with last year’s record-breaking level. Dallas reported particularly robust home sales in its Houston, Austin and El Paso markets.
The overall message appears to be that the economy is slowing down across the country, including housing. A soft landing appears imminent but no rate cuts are in the near future. The housing slowdown is beginning to cause layoffs. However, not all areas of the country are having the same degree of problems…the proverbial silver lining.
[Disclosure: I am one of interviewees for the New York Region]
Tags: Beige Book