Chicago's Mortgage Choice - October 13, 2015 Real Estate Report - The next really important number

Now that the September jobs report is behind us and we witnessed a slowdown in the creation of jobs, it will be interesting to see if the market's fear of a general economic slowdown is well founded. That is why the release of the third quarter snapshot of economic growth at the end of October will be very important. The economy has been up and down this year. The first quarter was slow and the second quarter saw more robust growth. Many economists are expecting a "regression towards the mean" this quarter. Before we get too worked up about this number, there are a few points that should be made about the statistic. First, it is a measure of past growth, and not indicative of what is happening now. It is also subject to future revisions and the future revisions will give a better view of the second half of the third quarter. Finally, the Federal Reserve Board meets again the same week as the data is released, but they conclude the meeting one day beforehand. Therefore, the Fed will release their results without the benefit of seeing this important snapshot of our economy. As of now, the markets are betting that the Fed will hold off rate increases again in October based upon the disappointing jobs data, as well as other reports showing that manufacturing is slowing. Even the strong growth we have seen in the real estate sector seems to be slowing a bit, though this sector still is one of the shining stars in the 2015 economy. For now it looks like real estate will have to carry us through this segment of our economic recovery. Thus, it is great news that recent reports have shown homes as affordable as ever in 2015. Keith Stewart 773-529-7000