What Do the Latest Housing and Consumer Confidence Statistics Tell Us?

It is very hard to determine what today’s housing statistics are telling us. First, you must consider the sources and the commentators and what, if any, their agendas are. Second, you must recognize that these statistics are fluctuating and that everyone has their own interpretation of them.

Today, the Miami Herald is reporting that Floridians are feeling less optimistic about the economy based upon an University of Florida consumer confidence index. According to the article, “The change comes as the hiring landscape in Florida hits a rough patch while housing values continue their monthly surge. But worries are rising that an impasse between Republicans and the White House will lead to either a shutdown of the federal government as early as next week or a broader fight over whether to increase the national debt ceiling. A failure to lift the borrowing limit, which the Treasury Department estimates will be met next month, could lead to the United States missing debt payments for the first time in its history if Washington doesn’t opt to divert money away from other needs to pay creditors.”

Read more here: http://www.miamiherald.com/2013/09/24/3647742/confidence-down-in-south-florida.html#storylink=cpy

At the same time Forbes is reporting that “The frenzy may be over right now, but for foreign buyers, U.S. residential real estate continues to be an alluring bet, especially as some stability returns to key markets like Miami, Las Vegas, Phoenix and coastal California.”

A very interesting statistic, especially in South Florida where Developers are citing the strong foreign appetite for South Florida luxury condominiums, is also reported in the article:

“International sales of U.S. residential real estate dropped by $14 billion to $68.2 billion, according to the National Association of Realtors’ analysis of data from March 2012 through March 2013. That’s down from $80 billion spent by foreign buyers the year before.”

A continued downward trend, rising interest rates in the US and a continued devaluation of currencies in Latin America versus the dollar could spell disaster in Florida. Only time will tell, but investors should pay particular attention to the most recent statistics.