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The Atlanta Fed's SouthPoint offers commentary and observations on various aspects of the region's economy.

The blog's authors include staff from the Atlanta Fed's Regional Economic Information Network and Public Affairs Department.

Postings are weekly.


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07/16/2015


Southeast Manufacturing Rebounded in June

The Southeast Purchasing Managers Index (PMI) report, released on July 5, showed that manufacturing activity in the Southeast rebounded from a less-than-spectacular May. If you'll recall, May's PMI reading was heading in the wrong direction. The overall index had fallen to its lowest level this year, and new orders and production also appeared to be falling, but June's Southeast PMI got us back on the right track.

The Atlanta Fed's research department uses the Southeast PMI to track regional manufacturing activity. The Econometric Center at Kennesaw State University produces the survey, which analyzes current market conditions for the manufacturing sector in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. The PMI is based on a survey of representatives from manufacturing companies in those states and analyzes trends concerning new orders, production, employment, supplier delivery times, and inventory levels. An index reading above 50 indicates expanding activity, and a reading below 50 indicates contracting activity.

The PMI index rose 2.7 points in June to 55.1 from May's 52.4 (see the chart). Most of the subindexes indicated positive movement as well, particularly new orders and production.

  • The new orders subindex rose 9.3 points to 55.3, after falling into contractionary territory in May.
  • The production subindex increased 8.9 points compared to the previous month and now reads 57.9.
  • The employment subindex declined 3.0 to 57.0.
  • The supplier deliveries subindex decreased 3.4 points to 52.6.
  • The finished inventory subindex increased 1.6 points to 52.6.
  • The commodity prices subindex fell 1.4 points and now reads 52.6.

Se-purchasing-managers

The rise in the overall index is welcome news, but even more welcome are increases in the new orders and production subindexes. The new orders subindex is the most forward-looking indicator in the survey. When new orders fall, it generally suggests that future demand for manufacturing products may be weakening and future production may be lower. As a result, employment levels at manufacturers could also decline. It would normally take several months of subpar activity for this to occur, and a one-month drop is nothing to get excited about. Still, it is always nice to rebound quickly. June's report will hopefully set the stage for a strong third quarter.

By Troy Balthrop, a Regional Economic Information Network analyst in the Atlanta Fed's Nashville Branch

July 16, 2015 in Inventories, Manufacturing, Purchasing, Southeast | Permalink

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04/16/2015


Southeast Manufacturing: Solid as an Oak

When I was a kid, I spent a few fall afternoons cutting and splitting firewood with my older brother. I must say that I didn't care for the process at all. It was hard work, and I have much respect for people that carry on the time-honored tradition. I learned quickly that there were certain types of wood you wanted to stay away from. Oak was one of them. Now, I am ashamed to say that I didn't pay close attention when collecting tree leaves for science class, but I always knew when I was trying to split a piece of oak. As a matter of fact, when I would come across a piece of oak, I preferred to skip over it. Oaks are strong and stately trees and no fun at all to split. The March Southeastern purchasing managers index (PMI) report, released on April 6, reminded me of my ill-fated attempts to split oak. It is one tough piece of wood.

The Atlanta Fed's research department uses the Southeast PMI to track regional manufacturing activity. The Econometric Center at Kennesaw State University produces the survey, which analyzes current market conditions for the manufacturing sector in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. The PMI is based on a survey of representatives from manufacturing companies in those states and analyzes trends concerning new orders, production, employment, supplier delivery times, and inventory levels. A reading above 50 indicates that manufacturing activity is expanding, and a reading below 50 indicates that activity is contracting.

The March Southeast PMI's overall index declined slightly from February, falling 2.5 points to 58.0 (see the chart). However, the index has remained above the 50 threshold for expansion 14 out of the last 15 months. It also averaged a solid 58.0 during the first quarter.

  • The new orders subindex fell 6.6 points to 56.9.
  • The production subindex decreased 2.9 points compared with the previous month and now reads 61.8.
  • The employment subindex declined 9.2 to 57.8. The March report indicated that manufacturing payrolls have now grown for 18 consecutive months.
  • The supplier deliveries subindex increased 1.2 points to 54.9.
  • The finished inventory subindex increased 5.2 points to 58.8.
  • The commodity prices subindex rose 4.8 points and now reads 40.2.

Southeast Purchasing Managers Index

Optimism for future production also increased in March. When asked for their production expectations during the next three to six months, 53 percent of survey participants expected production to be higher going forward, compared with 46 percent in February.

Much of the recent national manufacturing data have been weak. In March, the industrial production report indicated that manufacturing output increased 0.1 percent during February, but output had declined in the previous two months. New orders for core capital goods also declined for the sixth consecutive month in February and the March ISM index, although still indicating expansion, fell to its lowest reading since May 2013. Some analysts believe cold weather and the strong dollar are affecting overall manufacturing activity.

Despite the recent weak national numbers, southeastern manufacturing appears to be holding strong...just like the oak trees I tried to split as a kid. If you've never split wood—and especially a piece of oak—try it sometime. I doubt it will make your top-five list of things to do. Oak is one tough piece of wood.


April 16, 2015 in Employment, Inventories, Manufacturing, Productivity, Southeast | Permalink

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03/12/2015


Southeast PMI Surges in February

The Southeast purchasing managers index (PMI) report was released on March 5, and it indicates that any lingering effects from the late 2014 manufacturing slowdown have abated. If you recall, the December Southeast PMI dipped into contraction territory, but it has rebounded nicely since. The PMI index has risen 14.9 points since December and now sits at its highest reading since April 2014.

The Atlanta Fed's research department uses the Southeast PMI to track southeastern manufacturing activity. The Econometric Center at Kennesaw State University produces the survey, which provides an analysis of current conditions for the manufacturing sector in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. The PMI is based on a survey of representatives from manufacturing companies in those states and analyzes trends concerning new orders, production, employment, supplier delivery times, and inventory levels. A reading above 50 indicates that manufacturing activity is expanding, and a reading below 50 indicates contracting activity.

The Southeast PMI's overall index rose 4.9 points to 60.5 in February (see the chart). The subindexes also suggest some positive future developments:

  • The new orders subindex rose to 63.4, a 6.0 point increase over January and a 29.4 point increase over the last two months.
  • The production subindex increased 3.5 points over the previous month and now reads 64.6.
  • The employment subindex rose 7.8 points over January to 67.1, indicating that manufacturing payrolls grew for the 17th consecutive month.
  • The supply deliveries subindex increased 1.8 points from the previous month to 53.7.
  • The finished inventory subindex increased 5.5 points compared with January.
  • The commodity prices subindex fell 1.7 points and now reads 35.4.

Southeast Purchasing Managers Index

Optimism for future production fell in February. When asked for their production expectations during the next three to six months, 46 percent of survey participants expected production to be higher going forward, compared with 61 percent in January. The good news is that no survey respondents expect production to be lower than their current levels during the same time period.

The change in energy prices and severe winter weather are just a couple of challenges manufacturing faces. Some isolated reports of reduced orders from manufacturers closely tied to the energy sector have emerged, but on the other hand, the drop in oil prices has other contacts saving money on fuel costs. However, most contacts in the Southeast have expressed little direct energy-related effect on their business activity. Judging by the February PMI report, southeastern manufacturing is holding strong. We'll see if the positive momentum sustains into spring.


March 12, 2015 in Economic conditions, Economic Indicators, Inventories, Manufacturing, Prices, Productivity, Southeast | Permalink

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11/13/2014


Signs Point Up for Regional Manufacturing

Have you ever noticed all the signs in the world around you? They are everywhere. Many of them can prompt some deep thought. For instance, I was recently driving to work one morning, and three deer ran out in the road in front of me. Luckily, I didn't hit them, but it made me wonder: Who decides where to put deer crossing signs? How do they know a deer wants to cross the road right there?

Speaking of signs worth your attention, the signs for southeastern manufacturing are pointing up, according to the latest Southeast Purchasing Managers Index (PMI), which was released on November 6. The report suggests that things look pretty strong, and digging into the report, one could conclude that things are even stronger than they initially appear.

The Atlanta Fed's research department uses the Southeast PMI (produced by the Econometric Center at Kennesaw State University) to track manufacturing activity in the Southeast. The survey analyzes current conditions in the manufacturing sector in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. The Southeast PMI is based on a survey of representatives from manufacturing companies in those states and analyzes trends in new orders, production, employment, supplier delivery times, and inventory levels. A reading above 50 indicates that manufacturing activity is expanding, and a reading below 50 indicates that activity is contracting.

The PMI increased to 56.5 in October, which was a 1.5 point increase over September (see the chart). Some notable highlights:

  • The new orders subindex remained especially strong in October, registering 64.4, which is a 3.4 point increase over September's 61.0. New orders have averaged a solid 60.7 for the year.
  • The production subindex increased significantly to 67.3 during October, 8.3 points higher than September's reading of 59.0.
  • The employment subindex fell 2.2 points from the previous month. October's reading of 54.8 still indicates that manufacturing payrolls are increasing.
  • The supplier deliveries subindex rose 3.8 points during October, indicating that delivery of inputs is slowing as a result of high demand.
  • The finished inventories subindex fell 5.7 points compared with September and sits at 41.3. The fall in finished inventories suggests that inventory levels are lower than the previous month and could lead to higher orders in the near future.
  • The commodity prices subindex fell to 51.0, a 2.0 point decrease from September.
Southeast Purchasing Managers Index

When asked for their production expectations over the next three to six months, only 21 percent of survey participants expect production to be higher, down from 50 percent in September. According to the survey, 19 percent of survey respondents expect production to be lower than their current production levels. Those responses imply that 60 percent expect production to stay at current levels.

So to recap: The PMI indicates that regional manufacturing has seen strong new orders and production, employments levels are expanding, demand for inputs could be slowing deliveries, inventory levels are falling, commodity prices are essentially flat, and most purchasing managers are expecting to remain at their current levels of production. Although the low production expectations for the next three to six months prevent it from being a perfect set of conditions, they collectively indicate strong manufacturing activity in the near future. Just as with the deer crossing signs, I'll be paying close attention.

By Troy Balthrop, a Regional Economic Information Network analyst in the Atlanta Fed's Nashville Branch

November 13, 2014 in Economic conditions, Employment, Inventories, Manufacturing, Prices, Productivity, Southeast | Permalink

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08/27/2014


Southeast Housing Update: Exploring the Recent Slowdown

Following several months of somewhat disappointing reports on home sales and housing starts, we decided that it was time to ask the residential brokers and builders who participate in our monthly housing market poll to revisit the factors that may be contributing to slower-than-hoped-for growth.

When housing’s momentum began slowing in mid-2013, many contacts pointed to rising mortgage rates as the reason. Then in early 2014, many attributed the continued sluggishness to inclement weather. Although it seemed that weather did, in fact, play a role, our business contacts reported that less affordable buying conditions (for example, higher rates and prices) and limited inventory were greater culprits.

So what is the reason now? Our latest poll results suggest that contacts continue to believe that less affordable buying conditions and limited inventory—plus tight credit conditions—are the main factors behind the slowing activity (see the table).

Factors Influencing the Slow Growth of the Housing Market

Although the results of this special question help us as we think through what might be contributing to the weak growth, it is important to acknowledge that the incoming data (and upwardly revised data from the past few months) suggest that housing activity might not actually be slowing to the degree we previously thought. And in fact, a quick look at the latest poll results (without considering the special question) might also lead one to conclude that regional housing market conditions remain fairly positive. To explore the latest results in more detail, please view our Construction and Real Estate Survey results.

Note: The latest poll results reflect activity in July 2014 and are based on responses from 44 residential brokers and 16 homebuilders and were collected August 4–13. If you would like to participate in this poll, please consider signing up.

Photo of Jessica DillBy Jessica Dill, senior economic research analyst in the Atlanta Fed's research department


August 27, 2014 in Economic conditions, Housing, Inventories, Prices, Real Estate, Southeast | Permalink

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07/10/2014


A Southern Slowdown in Manufacturing?

Manufacturing in the Southeast had been thriving in recent months. According to the Southeast Purchasing Managers Index (PMI) report, new orders, production, and employment at regional manufacturers had been strong since March. The latest PMI report, released on July 7, suggests that activity may be slowing down a little bit.

The Southeast PMI is produced by the Econometric Center at Kennesaw State University. A reading on the index above 50 represents an expansion in the manufacturing sector, and a reading below 50 indicates a contraction. The survey provides an analysis of manufacturing conditions for the region in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. Representatives from various manufacturing companies are surveyed regarding trends and activities in new orders, production, employment, supplier delivery time, and finished inventories.

The June PMI decreased 4.5 points compared with May. Although still boasting an overall reading of 55.3 points (which is not bad), the new orders and production subindex readings dropped. The new orders subindex fell 10.1 points from May to 59.4, and the production subindex fell 10.8 points to 56.6 compared with the previous period (see the chart). The readings are still firmly in expansion territory, but they don’t have the excitement of the high readings from previous months. The employment subindex also decreased 4.6 points from May’s 55.2. Manufacturing payrolls are still increasing, according to the PMI survey, but fewer companies may be adding employees.

Southeast Purchasing Managers Index

The supplier delivery times subindex increased 1.8 points during the month, suggesting that it is taking a little longer to receive inputs at manufacturing plants. The commodity prices subindex fell 10.0 points compared with May, which could be a sign that price pressures for materials may be easing.

Looking ahead, manufacturing contacts’ optimism concerning future production remains lackluster. When asked for their production expectations, only thirty-four percent of survey participants expect production to be higher in the next three to six months. The percentage of contacts expecting higher production has been falling in recent months.

So, is manufacturing activity slowing? It’s difficult to draw that conclusion over one month’s data. However, the sharp drop in new orders and production is hard to ignore. It’s important to remember that the overall PMI reading is still positive and is in line with June’s national index reading of 55.3 from the Institute for Supply Management. The Southeast PMI indicated that manufacturing activity had been sprinting down the track in recent months. Maybe it needed a breather, or maybe it pulled a hamstring. We’ll have to wait and see.

By Troy Balthrop, a Regional Economic Information Network analyst in the Atlanta Fed’s Nashville Branch


July 10, 2014 in Employment, Inventories, Manufacturing, Productivity, Southeast | Permalink

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06/12/2014


Southeast Manufacturing Rides a Wave in May

The most recent Southeast Purchasing Managers Index (PMI) indicated that manufacturing activity continued to expand in May. The latest report, released on June 5, put the overall index at 59.8 points. Although the May index was 3.4 points below April’s 63.2 level, it was still well above the 50-point threshold, indicating expansion in the manufacturing sector.

The Southeast PMI is produced by the Econometric Center at Kennesaw State University. A reading on the index above 50 represents an expansion in the manufacturing sector, and a reading below 50 indicates a contraction. The survey provides an analysis of manufacturing conditions for the region in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. Representatives from various manufacturing companies are surveyed regarding trends and activities in new orders, production, employment, supplier delivery time, and finished inventories.

All components of the Southeast PMI decreased during May, but for the most part, only slightly (see the chart):

  • The new orders subindex fell 2.8 points from April but remained a solid 69.6. A high new orders subindex is a good sign that future production activity will be robust.
  • The production subindex fell 0.7 points compared with April, but like new orders, it remained strong with a reading of 67.4. The high production subindex suggests that factories are currently busy, Coupled with the elevated new orders subindex, manufacturing firms stand a good chance of remaining busy in the months to come.
  • The employment subindex declined 0.8 points from April to 63 but still indicates that manufacturing payrolls are increasing.
  • The supplier delivery subindex also suggested strengthening in the sector. While it fell 5.2 points to 57.6, it remains solidly in expansionary territory—an indication that demand for inputs among manufacturers is healthy.

A notable aspect in the PMI report was the responses to the survey question concerning future production. When asked about their production expectations over the next three to six months, only 41 percent of purchasing managers expect production to be higher. That rate is somewhat out of line with the strong new orders numbers we’ve seen, but maybe some underlying elements are dampening purchasing managers’ optimism.

The Southeast PMI has averaged a reading of 61.5 during the last three months. That level represents the strongest three-month average since early 2012. Let’s hope that manufacturing activity can continue to ride the wave and not wipe out this summer.

By Troy Balthrop, a senior Regional Economic Information Network analyst in the Atlanta Fed’s Nashville Branch


June 12, 2014 in Employment, Inventories, Manufacturing, Productivity, Southeast | Permalink

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04/10/2014


Southeastern Manufacturing...a Lion or a Lamb?

Remember the saying, “March comes in like a lion and goes out like a lamb?” Its origin is believed to be related to the position of the constellations Leo (the lion) and Aries (the lamb) during the month of March. Some observers suggest that it’s simply an indication that the weather is changing, with the end of winter at the first of the month and the beginning of spring at the end of the month.

I’m not sure which is true, but the weather wreaked havoc on the manufacturing industry the last few months. January and February were particularly tumultuous. Manufacturing contacts in the Southeast reported difficulties receiving supplies, shipping orders, and operating production lines at full capacity because some employees were unable to report to work during those two months. The Atlanta Fed has been monitoring the effects of extreme winter weather on the manufacturing industry. The March Southeast Purchasing Managers Index (PMI) suggests that manufacturing has come back roaring, but we should watch out for a bit of bleating (see the chart).

The Southeast PMI is produced by the Econometric Center at Kennesaw State University. A reading on the index above 50 represents an expansion in the manufacturing sector, and a reading below 50 indicates a contraction. The survey provides an analysis of manufacturing conditions in Alabama, Georgia, Florida, Louisiana, Mississippi, and Tennessee. Representatives from various manufacturing companies are surveyed regarding trends and activities in new orders, production, employment, supplier delivery time, and finished inventories.

The March Southeastern PMI report came in quite strong. The overall reading of 61.5 was its highest since April 2012. There are a couple of different ways to interpret the strong report. With option one, the report is a result of businesses making up for lost production and order backlogs during the previous months, therefore pushing up production and new orders during March. Under option two, underlying demand is improving and will be robust going forward, and March is just the beginning of a strong year. Let’s take a look at the numbers.

The overall March PMI increased 5.5 points over February. The new orders subindex soared 11.2 points to 70.2 and the production subindex vaulted 10.4 points to 65.4. Going back to January, the new orders subindex has increased 21.2 points and the production subindex has risen 17.5 points. No doubt about it, these are solid increases. The employment subindex increased 6.7 points from February’s 52. The supplier delivery times subindex fell 0.3 point from 57 in February, indicating that purchasing agents are getting their supplies slightly faster than the previous month. The finished inventories subindex also fell 0.3 point compared to February. Optimism among purchasing agents increased during March. Fifty-eight percent of survey participants expect production to be higher over the next three to six months.

Southeast Purchasing Managers Index


Whether option one or option two applies remains to be seen. It could be a combination of both. It will be interesting to see the national Institute for Supply Management report in April. Will the rest of the nation experience a similar rise in manufacturing activity? Let’s hope so. We’d like to see the sharp rise in new orders and production in the Southeast resulting from a sustained improvement in demand rather than just a snap-back effect of improving weather. Either way, we will be keeping our eyes and ears open for the lion and the lamb.

By Troy Balthrop, a Regional Economic Information Network analyst in the Atlanta Fed’s Nashville branch

April 10, 2014 in Inventories, Manufacturing, Productivity, Shipping, Southeast, Weather | Permalink

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02/27/2014


Southeast Housing Update: Modest Improvement Continues

According to the latest results from our Southeast housing market poll, contacts continued to indicate that growth remained positive. More than half of our Southeast builder and broker contacts reported that sales increased modestly on a year-over-year basis (see the chart).

January 2014 Southeast Home Sales vs. a Year Earlier

Many builders indicated that buyer traffic had increased on a year-over year-basis. Reports from brokers were mixed (see the chart).

January 2014 Southeast Buyer Traffic vs. a Year Earlier

The majority of our Southeast builder panel indicated that inventory levels had remained unchanged from year-earlier levels, although most of our Southeast broker panel indicated that inventory levels had fallen from year-earlier levels (see the chart).

January 2014 Southeast Home Inventory vs. a Year Earlier

Most brokers and builders continued to report that home prices had increased slightly in January compared to year-ago levels (see the chart).

January 2014 Home Price vs. a Year-ago

Two-thirds of brokers reported that the amount of available credit either met or exceeded demand (see the chart).

Brokers: How available do you perceive mortgage finance to be in your market?

Similarly, two-thirds of builders indicated that the amount of available credit met or exceeded demand (see the chart).

Builders: How available do you perceive mortgage finance to be in your market?

It’s worth noting that while this picture hasn’t drastically improved over time, it hasn’t deteriorated much either despite the recent implementation of mortgage regulations (for example, thequalified mortgage rule, which went into effect on January 10). We plan to keep a close eye on this question as the year unfolds.

Residential construction update
Our builder contacts indicated that construction activity increased slightly on a year-over-year basis but remained unchanged month over month. Nearly three out of four builders reported that activity was in line with their plan for the period.

You may recall from previous SouthPoint posts that builders have faced challenges securing acquisition and development financing for lot development (here) and that builders identified lot availability as one of the biggest risks to their outlook (here). We posed a special question to our builder panel in an effort to gain more insight into the current lot inventory situation. Here are a few of the main takeaways:

  • Overwhelmingly and regardless of the market, builders reported that finished lots are extremely hard to come by in desirable locations. With few finished lots in the most desirable areas, many builders have moved to B and C locations for vertical construction. (B locations have become the new A locations, and C locations have become the new B locations.)
  • As a result of the increased demand for finished lots in good locations, contacts indicated that lot prices were appreciating rather quickly, and that this rate of price appreciation was problematic because the added cost on the front end does not align with the valuation that can be achieved on the back end.
  • A few builders reported that they were in the process of developing new lots in A locations, but many more contacts noted that it was cost-prohibitive to develop raw land in any location at this time. The latter group reported that private acquisition and development money was available to fill the void that banks have left but noted that it was more expensive and would significantly raise the cost of development to the point where it becomes no longer viable. No one on the builder panel seemed to think that it would be viable to develop raw land in B and C locations at this point.

Outlook on sales and construction activity
Over the next three months, most builders and brokers expect home sales to increase. Although expectations remain fairly positive, contacts were slightly less optimistic about sales growth relative to their year-earlier responses (see the charts).

Southeast Builder Home Sales Expectations Next 3 Months

Southeast Broker Home Sales Expectations Next 3 Months

Nearly two-thirds of builder contacts expect construction activity to increase over the next three months. With that said, builders’ outlooks appear to be slightly less optimistic relative to their year-earlier responses.

Southeast Builder Construction Expectations Next 3 Months

Note: January poll results are based on responses from 42 residential brokers and 23 homebuilders and were collected February 3–12, 2014. The housing poll's diffusion indexes are calculated as the percentage of total respondents reporting increases minus the percentage reporting declines. Positive values in the index indicate increased activity, and negative values indicate decreased activity.

If you are a real estate broker or homebuilder and would like to participate in this poll, please let us know by sending a note to RealEstateCenter@atl.frb.org.

Photo of Jessica DillBy Jessica Dill, senior economic research analyst in the Atlanta Fed's research department


February 27, 2014 in Construction, Economic conditions, Economic Indicators, Housing, Inventories, Prices, Real Estate, Southeast | Permalink

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01/20/2010


Regional retail holiday sales wrap-up: Strong start, feeble finish

National results
Nationally, retail sales in December were disappointing. A review shows national retail sales posted a strong gain of 5.4 percent from December of last year, the largest year-over-year growth since November 2007. However, December 2008 posted dismal retail sales numbers, so this gain should not be weighted too heavily. On a month-to-month basis in 2009, the market showed signs of rallying; retail sales looked strong in November, anticipating the beginning of at least adequate holiday sales. But hopes were dashed as the numbers came in reporting a drop of 0.3 percent in national retail sales from November to December. The Bloomberg market consensus predicted an increase of 0.5 percent for the same time frame. This information could suggest that most consumers did their holiday shopping in November rather than December 2009 as November retail sales were comparatively strong on both a monthly and annual basis. Coming out of the 2009 holiday season, the national retail sales trend remains positive for the year and appears to be showing growth.

012010a

012010b 

Regional results
Regional retail sales were slightly more encouraging than the national results. Retailers throughout the district reported that sales either met or surpassed expectations in December. Because expectations for holiday sales were conservative at best, retailers had prepared accordingly by choosing to keep inventories at low levels, and many expressed that this "just in time" level may be the new norm.

012010c 

In December, about half of our contacts reported sales above year-ago levels. Similar responses were logged when we asked how the entire holiday season stacked up to last year's experience. Information gathered from other retail contacts showed strength in discount stores and outlets while high-end/luxury stores had a mixed performance during the holiday season.

What can we take from this?
Overall the nation experienced disappointing holiday sales. While November numbers looked promising, the trend did not continue into December. Regionally, retailers appear to have experienced somewhat stronger holiday sales trends, especially in December, than the nation. Retail surveys for September, October, and December 2009 reported about half the retailers in the Southeast expressing optimism for the coming months—the highest levels since September 2007, which is an encouraging sign.

By Courtney Nosal, a research analyst in the Atlanta Fed's research department

January 20, 2010 in Inventories, Retail, Southeast | Permalink

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