Dip in Housing Starts and Permits in August

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • The rate of housing starts in August, reported by the Census Bureau and Department of Housing and Urban Development, DECLINED 5.8 percent to a seasonally adjusted annualized rate of 1.14 million;
  • Most of the decline was due to a slower pace of single-family home construction which fell in August to 722 million – the slowest this year
  • Builder confidence, in August, reported Monday, SURGED six points to 65, the highest reading since last October;
  • The pace of building permits DIPPED 0.4 percent to 1.139 million, dragged down by filings for permits for multi-family homes which fell 7.2 percent while permits for single-family homes EDGED UP 3.7 percent;
  • Despite an improvement in “buyer traffic” according to the NAHB survey, the rate of housing completions DROPPED 3.4 percent to 1.043 million in August. Most of the decline reflected a slower pace of multi-family completions.

Image result for housing starts

Home builders may be more confident, according to the National Association of Home Builders but, they’re not showing it according to the latest report on housing permits and starts,  from the Census Bureau.

Perhaps it was the end of the traditional home-buying season which led to the slower construction pace, but then why would builder outlooks surge as they did for September (the survey conducted in the first 10 days of the month generally reflects prior month’s activity.

The Housing Market Index, the NAHB’s confidence survey, jumped six points – the sharpest month-month gain since June 2015 — to 71. The outlook for current sales soared to 71 – the highest level since –September 2005. The forecast of sales six months out also rose to 71 – its highest level since August 2005. And the assessment of buyer traffic went up to 48, the highest level this year.

The improvement in market outlook came on the heels of yet another so-so employment report which showed only a modest gain in jobs and a decline in weekly earnings. Total construction employment dipped in August, according to the Bureau of Labor Statistics though the number of residential construction jobs rose.

Home builders must be operating on the if-you-build-it-he-will-come theory but even that could be a discomforting shock as the median price of anew home fell in July, the last data point, and were down year-year.

The Census construction report underscores that housing hasn’t caught up with the overall recovery in the economy which leaves it vulnerable to another downturn.

Hear Mark Lieberman every Friday at 6:20 am on POTUS Morning Briefing, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.

 

 

August Heat Wilts Retail Sales

By Mark Lieberman

Managing Director and Senior Economist

Highlights:

  • August retail sales – measured by prices – FELL $1.3 billion or 0.3 percent from July;
  • The initial report that July sales were essentially flat to June was revised to show a 0.3 percent INCREASE;
  • Year-year sales ROSE 2.1 percent in August, down from the 2.3 percent gain registered in July;
  • Excluding automobile sales, which were DOWN 0.9 percent in August, after FALLING 0.4 percent in July
  • Gasoline prices FELL 6¢ per gallon or 2.7 percent in August to their lowest level since April; Sales at gasoline stations FELL $257 million or 0.8;
  • Sales at virtually category of stores fell in August the exceptions being electronics, food and beverage stores and restaurants;
  • The biggest “losers” were garden and building material stores, sporting goods stores, gasoline stations and non-store retailers.

Image result for retail spending

Perhaps it was the heat, but shoppers stayed away from retail stores in droves in August, forsaking even restaurants, according to the Census Bureau’s monthly report on retail sales. The dip in retail activity came in the same month in which average weekly income fell.

The report could reflect retail discounting as well as sales since it is based on cash register receipts and not adjusted for inflation, according to a disclaimer on the report.

Nonetheless, it suggests a slowdown in retail activity consistent with other signs pointing to a wilting economy.

One of the few store categories to show an increase in sales was clothing stores, where sales were boosted by back to school shoppers. It also may have been too hot to cook at home as restaurant sales jumped $467 million – the largest increase since February – supporting the continuing increase in restaurant staff showing up regularly in the Bureau of Labor Statistics monthly Employment Situation release. Those jobs though are among the lowest paying.

Consumers weren’t driving as much despite a drop in gasoline prices in August. The 2.7 percent drop in the average price of a gallon translated in total sales falling 0.8 percent in August.

The weaker August sales report followed a weak gain in sales in July – just 0.1 percent over June — a weak start for third quarter consumer spending. In the first two months of the third quarter, retail activity was up just 0.47 percent from the second quarter.

Retail activity is roughly half of consumer spending, the largest component, about 67 percent –of Gross Domestic Product.

In the second quarter, GDP rose a weak 1.1 percent (seasonally adjusted annual rate) as personal consumption expenditures were up just 1.08 percent – more than double the increase in retail spending thus far in the third quarter.

Hear Mark Lieberman on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124, every Friday at 6:20 am Eastern Time. You can follow him on Twitter at @foxeconmics.

 

 

1st Time Unemployment Claims Inch Up Again; No Cause for Alarm

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • 1st time claims for unemployment insurance for the week ended September 10 ROSE for the second time in three weeks, up 1,000 to 260,000;
  • The number of claims for the week ended September 3 was unchanged at 259,000
  • Filings remained under 300,000 for the 80th straight week, the longest streak since 1970;
  • Four week moving average of first time claims DROPPED 500 to 260,750;
  • The four week moving average represented 0.172 percent of total employment, UNCHANGED from one week earlier and DOWN 0.011 percentage points from one year ago;
  • Continuing claims for the week ended September 3 – reported on a one-week lag — INCREASED 1,000 to 2,143,000;
  • The number of continuing claims for the week ended August 28 DECLINED 2,000 to 2,142.000;
  • Four-week moving average of continuing claims FELL 8,000 to 2,146,750, the fifth consecutive weekly increase.          .

Despite a one-week bump, initial claims for unemployment insurance for the week ended September 10  initial remained well below the “magic” number of 300,000 continuing to show a strong labor picture.

Image result for unemployment insurance claims

The data did not reflect any of the typical confusion which usually accompanies a holiday-shortened week. Nor did there appear to be any impact from Hurricane Hermine which threatened the Atlantic Coast during Labor Day weekend. Halfway through the hurricane season there have been two named storms. In 2015 there were four for the entire storm season.

The benign claims report combined with weak though positive jobs reports explain in part why the presidential campaign focus has shifted from the economic numbers to blood pressure and body mass index.

That said, despite the report on the year-year increase in household incomes released by the Census Bureau earlier this week, the economy – or more pointedly the labor market – remains a critical campaign issue.

A few weeks back there were questions raised about the economy – specifically the unemployment rate – by the Donald Trump campaign, suggesting the unemployment rate was about 42 percent, more than eight times the reported 4.9 percent. The scare tactic proved only the campaign did not understand how the unemployment rate is computed and was reminiscent of GOP attacks four years ago when the unemployment rate dropped sharply in a report issued just prior to election day, falling to 7.8 percent in September of that year from 8.1 percent in August.

The Bureau of Labor Statistics was accused then by, among others, former General Electric honcho Jack Welch of cooking the books to influence the election. What perhaps the accusations more credence was the report was released on October 5, 2012 with critics ignoring the fact another employment situation report would be released on November 2 of that year – four days before election day.

The Trump campaign was attempting to “poison the well” and undermine the next BLS unemployment rate report which is scheduled for releases October 7 with one more report, November 4, before election day.

The continuing low report on first time claims for unemployment insurance would support the current unemployment rate, though the labor market doesn’t feel as though there has been a recovery. And, to be sure, a large fraction of newly jobs have come in low paying industries which makes the Census Bureau report on household income even more intriguing.

With the increases in low paying jobs, it suggests a sharper increase in higher paying jobs or as presidential candidate Ralph Nader quipped during the 2000 campaign, “a rising tide lifts all yachts.”

Nonetheless, the unemployment insurance claims data should remove “jobs” as a campaign issue and turn the focus where it belongs, to incomes.

You can hear Mark Lieberman every Friday at 6:20 am on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.

Economy Slows, Adds Just 151K Jobs in August

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • Payroll jobs INCREASED a 151,000 in August, compared with a three-month average of 232,000;
  • Number of multiple jobholders INCREASED 201k in August;
  • Average weekly hours SLIPPED to 34.3 in August, lowest since December 2013;
  • Unemployment rate REMAINED at 4.9 percent;
  • Average weekly earnings FELL $1.54 to $882.54 in August, up just 2.1 percent year over year;
  • July’s 275k job gain REVISED DOWN to 256k, June’s 271k increase REVISED UP to 292k;
  • Labor force GREW a paltry 176k, as the number of people working GREW just 97k in August;
  • Labor force participation rate REMAINED at 62.8 percent;
  • Employment-Population ratio WAS FLAT at 59.7 percent;
  • Part time employment for economic reasons GREW 113k but part time employment for non-economic reasons FELL 194k;
  • Temp jobs DECLINED 3.1k;
  • Private sector ADDED 126k jobs, in August;
  • Government employment INCREASED 25k with 24k new local government jobs.

Image result for employment situation report

On the eve of the Labor Day holiday, the economy took a bit of a break, adding just 151,000 jobs in August, far below the 234,000 increase in working age population, the Bureau of Labor Statistics reported Friday. The weak August growth followed two solid months of hiring.

The relatively weak report threw into question whether the Federal Open Market Committee would increase the fed funds rate when it meets later this month. Such an increase had been expected based on hints from Fed speakers.

Not only was the number of new jobs small, but weekly earnings dropped in August cutting into consumer purchasing power.

The FOMC will meet twice more this year after September but is unlikely to raise rates when it meets in November (although the meeting will take place after the Presidential election) making a December hike more likely.

Beyond the headline numbers, the report suggested concerns in several industry sectors, among them construction, which lost 6,000 jobs and manufacturing where the number of jobs fell 16,000.

Even temp hiring was down, off 3,100 from July.

While the unemployment rate remained at 4.9 percent as it had been in June and July, the composition of unemployment changed as the number of people unemployed for 15 week or longer increased.

The number of person working part time for economic reasons rose but was offset by those working part time for non-economic reasons.

That the report came at the beginning of the Labor Day weekend, had the potential to upset markets as more veteran traders got an early start on the last weekend of summer, leaving trading to less experienced juniors.

Hear Mark Lieberman every Friday morning at 6:20 am on The Morning Briefing on POTUS on Sirius-XM 124.

You can follow Mark Lieberman on Twitter at @foxeconomics.

1st Time Unemployment Claims Inch Up Again

 

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • 1st time claims for unemployment insurance for the week ended August 28 ROSE for the first time in a month, up 2,000 to 263,000, the lowest level in five weeks;
  • The number of claim for the week ended August 14 was unchanged at 261,000
  • Filings remained under 300,000 for the 78th straight week, the longest streak since 1970;
  • Four week moving average of first time claims DROPPED 1,000 to 263,000;
  • The four week moving average represented 0.174 percent of total employment, UNCHANGED from one week earlier and from one year ago;
  • Continuing claims for the week ended August 21 – reported on a one-week lag — INCREASED 14,000 to 2,159,000;
  • The number of continuing claims for the week ended August 7 was UNCHANGED at 2,145,000;
  • Four-week moving average of continuing claims INCREASED 4,500 to 2,159,750, the fifth consecutive weekly increase.          .

Image result for unemployment insurance

On the eve of the monthly Employment Situation report, the Labor Department said initial claims for unemployment insurance rose a scant 4,00 for the week ended August 28 to 263,000, The number of continuing claims rose increased 14,000 to 2,159,000.

Initial claims remained below 300,000 for the 78th straight week –18 months – the longest such streak since 1970.

The claims reports were another in a series of data points suggesting the labor market has become flush with fewer jobseekers and an increasing number of job openings. The most recent JOLTS 9Job Openings and Labor Turnover Survey report noted the sixth month-month increase in job openings in the last seven months, putting openings 2 percent higher than a year earlier.

The consensus for Friday’s Employment Situation release is for an increase of 180,000 jobs which would be far slower than the 292,000 jobs added in June and 255,000 new jobs in July

The median forecast is the unemployment rate will drop again – to 4.8 percent – an improvement for July’s 4.9 percent. The unemployment rate fell to 4.7 percent in June.

Tomorrow’s report will be the last before the September 20-21 meeting of the policy-making Federal Open Market Committee. The next FOMC meeting is November 1-2. The Fed is unlikely to act on interest rates so close to election day and, though it raised rates in its December 2015 is unlikely to raise rates when it meets December 13-14 this year, a lump of coal in Christmas stockings.

That would point to a rate increase in three weeks – certainly if tomorrow’s report shows strong jobs gains. The fed will look beyond the number of jobs and focus on earnings. In July, average weekly earnings rose $5.33 to $886.31. Average hourly earnings, which rose 8¢ in July are expected to have gone up 14¢ in August. The FOMC will pay close attention to earnings as a potential source of inflation’

You can hear Mark Lieberman tomorrow at 8:45 am on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124 and again at 12:05 pm. You can follow him on Twitter at @foxeconomics.

 

 

 

1st Time Unemployment Claims Dip Again but Point to Weaker Jobs Report

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • 1st time claims for unemployment insurance for the week ended August 21 DECLINED for the third straight week, down 1,000 to 261,000, the lowest level in five weeks;
  • The number of claim for the week ended August 14 was unrevised at 262,000
  • Filings though remained under 300,000 for the 77th straight week, the longest streak since 1970;
  • Four week moving average of first time claims DROPPED 1,250 to 264,000;
  • The four week moving average represented 0.174 percent of total employment, DOWN from 0.175 percent one week earlier and from 0.182 percent one year ago;
  • Continuing claims for the week ended August 14 FELL 30,000 to 2,145,000, largest week-week drop since the end of June;
  • The number of continuing claims for the week ended August 7 was UNREVISED at 2,175,000;
  • Four-week moving average of continuing claims INCREASED 250 to 2,155,250.

Image result for unemployment insurance claims

Though first-time claims for unemployment insurance declined – again – in the week ending August 21, that’s not the major takeaway from this week’s Labor Department report.

Initial (and continuing) claims for have been so low for so long it should come as no surprise even the slightest bump up, as experienced at the end of July, could have cautionary ripple effects.

That increase in first-time claims – a not insignificant 14,000 to a still low 266,000 continues to plague the data series’ four-week moving average with the result the four week moving average for the “reference week” used by the Bureau of Labor Statistics’ Employment Situation report is up about 6,250 from mid-July, a signal we might not see as robust an improvement in the labor market.

Not only is the four-week moving average of initial claims higher in mid-August than it was in mid-July, but so is the average for continuing claims, a rough surrogate for payroll employment.

The economy, in the last three months, added an average of 190,000 new jobs, even accounting for a paltry 24,000 increase in May.

The increase in the four-week moving average of continuing claims suggests job growth may have slowed somewhat in August. (The average increase in payrolls for June and July was 274,000.) One explanation could be found in a study by economists Pauline Leung of Cornell and Alexandre Mas from Princeton who found the ACA expansion of Medicaid had little impact on employment.

“If workers ‘locked’ into employment for insurance reasons perceive the Medicaid expansions to be temporary due to constitutional or implementation challenges, they may be reluctant to leave their jobs and employer-sponsored insurance coverage,” the authors hypothesized.

The employment “churning” would show up in the payroll report.

That said, the jobs report to be released next week (on the Friday before Labor Day) may not be as robust as recent reports

You can hear Mark Lieberman every Friday at 6:20 am on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.

 

 

 

July Existing Home Sales Slip

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • The pace of existing home sales SLIPPED in July, down 3.2 percent or 180,000 to a seasonally adjusted annual sales rate of 5.39 million;
  • The June sales pace of 5.57 million was not revised;
  • Median price of an existing single family home FELL after five straight monthly increases, to $244,100 a drop of $3,500 or 1.4 percent;
  • Year-year the median price is UP $12,300 or 5.3 percent;
  • Number of homes available for sale in July EDGED UP 0.9 percent or 20,000 to 2.13 million;
  • With the slowed sales pace, the months’ supply of homes for sale in July grew to 4.7.

Image result for sales of previously owned homes

After breathing the rarified air of the strongest sales pace in almost nine years, sales of previously owned homes slipped in July. The decline was not unexpected since the pending home sales in for May – tracking contracts signed that month – slipped 3.7 percent which suggested a falloff in closings. Both sales (closings) of existing homes and prices fell in July, according to a report Wednesday by the National Association of Realtors (NAR) http://www.realtor.org/news-releases/2016/08/existing-home-sales-lose-steam-in-july.

The July drop led to the first year-year decline in sales since last November, down 1.6 percent from July 2015.

While first-time homebuyers accounted for the surge in closings in June, according to the NAR, the share of transactions by new buyers edged down to 32 percent in July from33 percent in June, still up from 30 percent in May.

The dip in first-time homebuyers threatens to continue the cycle of empty-nesters unable to sell their homes even though the supply of homes increased slightly in July. The home is a unique asset – unlike say stocks – since it provides an opportunity for growth while at the same time providing shelter. Many homeowners look to the growing value of their homes as a source of funds for retirement. The inability to sell thus affects retirement spending.

NAR President Tom Salomone of Florida, said “appraisal complications” (translation: prices often exceed the appraised value of a home, a factor which contributed to the foreclosure crisis) are delaying closings.

Those “complications,” he explained, are “a combination of sharply growing home prices in some areas, the uptick in home sales this year and the strong refinance market overworking the already reduced number of practicing appraisers.  Realtors® are carefully monitoring this trend, and some have already indicated they’re extending closing dates on contracts to allow extra time to accommodate the possibility of appraisal-related delays.”

Other market elements were positive with mortgage interest rates continuing to fall as employment and income improve.

Distressed sales – foreclosures and short sales – dropped to just five percent of transactions, down from six percent in June and seven percent one year ago. As distressed sales become an increasingly smaller share of the market, median home prices increase which, should attract more sellers and increase inventories.

There is, though, a downside to increased inventories of previously owned homes in that the market for newly built homes contracts.

Hear Mark Lieberman every Friday, on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124, at 6:20 am Eastern Time. You can follow Mark Lieberman on Twitter at @foxeconomics.

New Home Sales Improve in July to Fastest Pace Since October 2007;

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • Pace of contracts for new home sales JUMPED 12.4 percent in July to 654,000 (Seasonally Adjusted Annual Rate) – highest since October 2007;
  • Median price of a new home FELL in July 5.1 percent, $15,900, to $294,600 – lowest since January;
  • Sales pace for June revised DOWN to 582,000 from 592,000;
  • Number of homes for sale FELL to 233,000 – lowest since last November;
  • Months’ supply of new homes for sale TUMBLED to 4.3 months in July – lowest since August 2005

Image result for new home sales

In baseball, when a hitter is in a slump, observers look for a “break out” at bat or game. Well, new home sales have been in a slump and July may have been such a “break out.”

The pace of contracts for new home sales rose at its fastest pace in almost two years (August 2014 – 12.7 percent) as shoppers took advantage of a sharp drop in the median price of a new home – down 2.1 percent for the month and 0.5 percent year-year, according to the Department of Housing and Urban Development-Census Bureau’s new home sales report for July.

The government data came despite a dip in buyer traffic as reported by the National Association of Home Buyers in its monthly Housing Market Index.

Tighter labor market conditions however are steadily lifting wages. The improved earnings coupled with mortgage rates near historic lows are combining to support housing. According to Freddie Mac, the average rate for a 30-year mortgage in July was 3.44 percent compared with 3.57 percent in June.

The weak inventory can be good news in that with demand running high it should translate into increased home building. Permits for new single-family homes through fell in July to an annualized rate of 711,000, the slowest pace since last August while permits for multi-family homes rose for the fourth straight month. Builders broke ground in July for single-family homes at the rate of 1.211 million – the second fastest pace since October 2007.

Data on sales of previously owned home sales are set for release from the National Association of Realtors Wednesday.  Unlike new home sales which are reported as contract signings, existing home sales are reported on closing, completed transactions. Those purchases jumped in June to the strongest level in more than nine years, helped by first-time buyers.

Hear Mark Lieberman on P.O.T.U.S. (Sirius-XM 124) Friday at 6:20 am Eastern Time. You can follow Mark Lieberman on Twitter at @foxeconomics.

1st Time Unemployment Claims Dip, Remain Low Historically

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • 1st time claims for unemployment insurance for the week ended August 14 DECLINED for the second straight week, down 4,000 to 262,000;
  • The number of claim for the week ended August was unrevised at 266,000
  • Filings though remained under 300,000 for the 76th straight week, the longest streak since 1970;
  • Four week moving average of first time claims INCREASED 2,500 to 265,250;
  • The four week moving average represented 0.175 percent of total employment, UP from 0.173 percent one week earlier;
  • Continuing claims for the week ended August 7 INCREASED 15,000 to 2,175,000
  • The number of continuing claims for the week ended July 30 was REVISED UP 5,000 to 2,160,000;
  • Four-week moving average of continuing claims INCREASED 10,750 to 2,155,000.

Image result for unemployment insurance

The labor market continues to tread water – at the shallow end of the pool – with another drop in the number of individuals filing first time claims for unemployment according to the Labor Department’s report for the week ended August 14.

What makes the routine report – showing total first-time claims at 262,000 – somewhat more remarkable is it comes against a backdrop of high total employment: 151.5 million in the last Employment Situation release from the Bureau of Labor Statistics. On the premise that you have to have a job before you can be laid off and eligible to file for unemployment insurance, when 262,000 people filed initial claims for unemployment insurance in March 1970, total employment was 78.9 million. So, while the current situation isn’t great for those who lost jobs, it isn’t bad in an historical context. Plus, the current level of new claimants matches up well with job openings: 5.6 million per the latest BLS report on the subject. (The Job Openings and Labor Turnover Survey wasn’t produced in 1970.

The point is, the tight labor market, as suggested by current numbers, suggest those who are laid off are not automatically doomed to be out of work for long.

Continuing claims for unemployment insurance at 2.175 million are way below the all-time high of 6.628 million in May 2009. Going back further, to March 1970, the number of continuing claims was about 1.52 million.

You can hear Mark Lieberman every Friday at 6:20 am on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.

 

 

When Will Housing Break Out?

By Mark Lieberman

Managing Director and Senior Economist

Reports this week seem to suggest a rebound in housing:

  • Builder confidence, in August, reported Monday, climbed back to 60 (out of 100) after a relative slump for most of the year;
  • The August two-point INCREASE was made to look a bit better after the July index was revised down from 59 to 58;
  • July housing starts, reported by the Census Bureau and Department of Housing and Urban Development, INCREASED 2.1 percent to a seasonally adjusted annualized rate of 1.211 million, the second fastest pace since October 2007 (the pace of starts was 1.213 million in June 2015 and March of this year);
  • Housing permits DIPPED to an annualized rate of 1.152 million in July from 1.153 million in June;
  • The rate of housing completion dropped to 1.026 million in July from1.119 million in June a decline of 2.1 percent, the third straight month over 1 million. In the last 12 months, the rate of housing completions averaged 1.018 million, up for 934,000 in the previous 12 months.

Image result for home building

With numbers like those, why are we still waiting and looking for housing to “break out?”

The answer – as it usually does – comes from looking behind the headline numbers and at other housing-related data.

Let’s take permits and starts for example.

The lucrative (for builders) single-family housing market did not share in the recovery in July.

Single-family starts rose just 0.5 percent to an annualized rate of 770,000 but multi-family starts jumped 5.0 percent to 441,000 – the fastest pace in nearly a year (446,000 last September).

The rate of completions of single-family homes dropped just 0.4 percent in July while completions of multi-family housing units dropped 24 percent, suggesting an increase in the supply of single-family compared with multi-family units.

That seems to be consistent with the trend away from homeownership. The homeownership rate, according to a Census report last month dropped to 62.9 percent, a 51-year low.

The message in the declining homeownership rate could suggest an alteration of the American Dream of homeownership.

A couple of factors go into that. Clearly weak income growth coupled with high prices discourage either first-time or trade-up buyers. The median price of an existing single-family was a record $247,700 in June after increasing for four straight months. Year-over-year, the median price of an existing single family home in June was up 4.8 percent and has increased for 52 consecutive months. The median price of a new single family home increased 6.2 percent in June, up 6.1 percent in the past year. The Case Shiller Home Price Index confirms similar trends.

Compounding the price pressures are sociological trends as would-be empty-nesters are no longer empty nesters as millennials struggling to find or keep jobs find themselves priced out of rental markets and return “home.” That’s created a bottleneck as potential home sellers keep their homes off the market, limiting choice. And, the inability to sell has a negative impact on retirement plans.

Adding to market uncertainty would be mortgage rates. With the Federal Reserve moving in fits and starts in monetary policy – one week hinting at a near-term rate hike only to move to stable rates the next week – buyers are uncertain as to whether they have a little more time to shop.

That factor has shown up in one of the components of the National Association of Home Builders Housing Market Index: buyer traffic, the only one of the three components to remain below 50 – the arbitrary line separating a pessimistic outlook from optimism. The last time the buyer traffic measure was at 50 or above was January 2006, when the homeownership rate topped 68 percent.

Employers have even slowed hiring. While residential construction jobs were increasing at a rate of 19,000 a month in the fourth quarter of 2015 and first quarter this year, residential construction employment has actually fallen since March 31.

Housing still has a long way to go.

Hear Mark Lieberman every Friday at 6:20 am on POTUS Morning Briefing, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.