Christmas week shopping surged and 10 years…no gain in home prices

–(– 01/01/2010 – Financial News industry news provided by Financial News USA. Four of the season’s top seven days of traffic were during the week ended Dec. 26, sales and traffic tracking firm ShopperTrak reported. The firm based its results on a sample of over 50,000 retail stores and enclosed malls.

The week followed a disappointing Saturday before Christmas, Dec. 19, that saw the major cities in the Northeast socked by a huge snowstorm.

“As expected, pent-up demand following the snowstorm on Super Saturday (Dec. 19) pushed consumers to spend heavily last week,” Bill Martin, co-founder of ShopperTrak, said in a statement.

Shoppers bought even more the day after Christmas than they did during the week leading up to the holiday, the report showed.

Spending totaled $7.9 billion on Dec. 26, up from $7.8 billion last year, making it the second best shopping day of the holiday season. Foot traffic climbed 7.7% compared with the previous Saturday, but dropped 6.6% from the same day last year. [Read the full article]

The median home price in November 1999 was $137,600, NAR said, and by November 2009 it had risen 25% to $172,600. But with cumulative effect of inflation, prices are actually 3% lower in real terms.

The good news is that wages have risen in the past 10 years, so homes are now affordable than they had been, especially at the height of the boom in the middle of this decade, said Walter Molony, a spokesman for the Realtors.

The median home price peaked in June of 2006 at $231,000. (See how much you gained on your home.)

There have been other changes in the workings of the housing market over the past 10 years: More house hunting is now done online, a greater percentage of the homes purchased are in the suburbs and more multi-family home units — condos, townhouses and coops — are being bought.

There has also been an increase in the number of single folks buying homes on their own. Back in 1999, single men accounted for 9% of all home sales and single women 18%. [Read the full article]

“I think it’s great for people to have a sense of mystery,” Erminio Pinque says of the passers-by who pop their heads in to ask about the creature collection. “It paves the way to explain what goes on here. It’s a little complicated.”

Pinque is the artistic director and founder of Big Nazo, a performance group that has turned its surreal art and puppetry into a thriving business. New Year’s Eve kicks off one of Big Nazo’s busiest seasons ever: Next month, the troop will take dozens of its creatures to Vancouver for a series of appearances at the Winter Olympics.

But Providence residents can get a sneak peek at Big Nazo’s performances by simply stepping into the Fulton Street lab. It’s part studio, part interactive art project. Inside, Big Nazo’s artists construct masks, puppets and props for their theatre productions and television commercials. [Read the full article]

But most forecasts predict price declines in 2010, with possible losses ranging from anywhere from 3% on up. Fiserv Lending Solutions, a financial analytics firm, forecasts that prices will fall in all but 39 of the 381 markets it covers, with an average drop of 11.3%.

“We’ve seen recent price stabilization because of low mortgage interest rates and the impact of the first-time homebuyers tax credit,” said Pat Newport of IHS Global Research. “But there are really good reasons to think prices will now start going down.”

There are three main reasons for the reversal: a coming flood of foreclosures, rising interest rates and the eventual end of the tax credits.

For Gus Faucher, the director of macroeconomics for Moody’s, the huge number of foreclosures that remain in the pipeline is the big problem.

Moody’s upped its estimate of defaults recently because of shortcomings of the government-led mortgage modification programs. [Read the full article] About Financial News USA

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