From the FDIC:
New Jersey State Profile – Fall 2006
The economic expansion in New Jersey is slowing.
New Jersey’s employment growth eased during first half 2006, reaching 0.9 percent in the second quarter and lagging the U.S. average of 1.4 percent. The state’s growth rate stabilized in July and August at 0.7 percent.
Job growth varies across the state. Gains in the leisure, financial, and other service sectors have contributed to strong growth in Central and Southern New Jersey.1 Stagnant job growth in Northern New Jersey during the past two years reflects continuing manufacturing job losses and weakness in the professional, health, and telecommunications sectors. In addition, pharmaceutical companies continue to trim payrolls.
Housing momentum has shifted from a seller’s to a buyer’s market.
Sales of existing single-family homes, condos, and co-ops in New Jersey declined for the third consecutive quarter, while the rate of home price appreciation is slowing. ome sales dropped 16 percent in second quarter 2006 from a year ago, the sharpest quarterly decline since 1991.
Although it is still higher than the U.S. average, New Jersey’s rate of home price appreciation declined to 12.4 percent (year to year) during second quarter 2006, the state’s lowest rate in over two years. Going forward, price trends will depend on employment conditions, interest rates, and housing affordability.
A slowing housing sector may dampen statewide job growth. However, jobs related to residential and commercial real estate has contributed less to job growth, generating 16 percent of net new jobs in the state between second quarters 2002 and 2006 compared with 20 percent for the nation.
Marginal borrowers may face financial pressure.
Borrowers with adjustable rate mortgages, and less creditworthy borrowers in particular, may be more vulnerable to the effects of “payment shock” should their mortgage rates (or payments) reset at higher levels. According to the Mortgage Bankers Association, the foreclosure rate on subprime adjustable rate mortgages in New Jersey is inching up, increasing from 1.19 percent to 1.78 percent between the second quarters of 2005 and 2006. However, this level remains below the U.S. average of 1.87 percent and is almost half the peak of 3.97 percent reached in New Jersey in 1999.
From the AP via Newsday:
FDIC latest to find that NJ economic growth declining
Further evidence that economic growth in New Jersey has declined came Thursday as a federal banking agency found continued deterioration in the state’s jobs and home sales.
Employment grew by just 0.9 percent in the second quarter, trailing the national average of 1.4 percent, the Federal Deposit Insurance Corp. reported. The rate in central and southern New Jersey was above 1.5 percent, but losses in northern New Jersey due to factory closings and layoffs dragged the average down.
Jobs growth has been largely flat for the past two years, in part because of weakness in the telecommunication and pharmaceutical sectors.
Sales of existing homes in New Jersey fell for the third consecutive quarter, plunging 16 percent for the three months ended June 30, the sharpest quarterly drop since 1991, the FDIC found.
From the Journal News:
Home prices plunge in Putnam, rise in Westchester
resh data from a statewide group of Realtors shows that prices for houses in Putnam County slid by double digits in August, as the region’s housing market continues to cool.
The median price of a single-family home in Putnam fell 13.7 percent to $402,500 from $466,300 compared to August 2005, the data from the New York State Association of Realtors revealed yesterday.
In Westchester, however, home prices continued to rise, gaining 2.7 percent to $749,500 from $730,000 in August 2005.
As reported Sunday, prices in Rockland fell 8.4 percent in August to $490,000 from $535,000 a year ago.
In all three counties, the number of homes sold fell substantially, with Putnam recording the largest percentage drop. In August, the county recorded 81 sales, down from 142 in August 2005 – a 43 percent drop. In Westchester, 652 homes were sold, 22.6 percent fewer than the 842 that sold a year ago.
In Rockland, as reported earlier, sales fell 24.3 percent to 165 from 218 a year ago.
wow this blog has deteriorated significantly from my last visit. I wonder if it has anything to do with the increasing evidence of a soft-landing which was naturally mocked on this blog. I remember people were watching the Tens very closely and some predicting 7% by year end.
I remember when a slight decrease in Mortgage Applications or Pending Home Sales deserved the front page.
Boooooyaaaaaa!
which reminds me…what the hell happened to Bob? I guess he got killed by the bursting bubble
Whatever,
Remember – It’s not over ’til the fat lady sings.
Wow, job losses in manufacturing, professional, health, telecommunications and pharmaceuticals, with gains in the cutting edge field of leisure. Way to go NJ!!!
Okay, there were gains in finance. However, the financial sector includes finance, insurance and real estate. I have to wonder how many of these jobs were related to lending and real estate.
whatever,
Like to hear the increasing evidence of a soft landing???
I’m not quite sure what you mean by “deterioration”.
Site traffic continues to break records every week. The number of comments dropped off dramatically due to a combination of the message-board fiasco and the site change. The majority of search engine traffic still hits the old site. It’ll be months before we’re categorized properly in Google, Yahoo, MSN, and the other search engines. A large number of the one-off anonymous comments were due to that search engine traffic.
jb
Actually, I’m really glad to see the level of comments picking back up again.
jb
Yea the new commenting system has been great, I am really enjoying all the discussions
I too like this way of commenting better!
I do NOT miss all the inane Anon comments and find that most now take the time to think out their thoughts before throwing up a post.
Okay, maybe not most! But some do now that they have to assign a “name” to themselves.
But back on topic, it was surprising to me at first to see that so much of the job loss is in the northern part of the state (I assumed it was spread pretty evenly). It just goes to show how much AC brings to the state as far as jobs.
Anyway, I’m expecting the old argument that it won’t affect us as a large portion of the population works in NYC. But of course that can’t hold true as those who lost these communication and pharmaceutical jobs are out of work IN New Jersey.
Very interesting data… unless of course the Trilateral commission has their hands in… but I digress.
Rich
Guys … see the Yld Curve today.
2 Yr – 4.6
5 Yr – 4.5
30Yr – 4.5
5 Yr lost 30 Bps in last month and 50 in last 2 months !! Last time I saw these figures were in 2001 !!
Recession is knocking – Mark your doors !!
I just got this in my email.
Can you believe this crap?
I have no idea who they are and how they got my email?
Read on :
I’m the Mortgage Consultant that’s been assigned by one of our Client Services Managers to assist you with your home financing needs. My company, Mortgages At Wholesale is an affiliate of The Realty Corporation and I guarantee you will not find a lower cost mortgage with a better rate or I will give you $500!
Our company was founded with the philosophy that consumers are being overcharged for their mortgage transactions. To that end, we always strive to offer appropriate advice and honest answers while providing a guarantee that we will find you the best mortgage program available.
By combining the services of The Realty Corporation and Mortgages At Wholesale we can offer you substantial savings on your real estate transaction.
I can pre-qualify you for a mortgage in 5 minutes. Do you have some time this week to chat? If so, please indicate a good day/time/phone number and I will give you a call. Like I said, the process is simple and easy.
MSD,
There are many posts stating that this market will be saved by lower rates. The inverted yield curve is tellling me something different.
There are storm clouds brewing. You are right about the knock on the door.
Today the MBS volume was the highest of alomost last 2-2.5 quaters. After Ben’s comments about lowering the int rate People are trying to get hold of those 6.0 and 6.5 coupon MBSs I guess.
(MBS – Mortage Backed Securities)
I remember people were watching the Tens very closely and some predicting 7% by year end.
Just to clarify.
We’re all still watching the tens very closely, and the predictions regarded 30y fixed mortgage rates, not 10y yields.
jb
Wher again is the evidence for a soft landing, must have been the 13.7% drop in prices from August 05 till August 06 in Putnam. And its only getting started.
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