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MARKET INFO THAT HITS US WHERE WE LIVE.

A shower of home purchases sure sweetened the real estate market in April, as Existing Home Sales gained 0.6% for the month, hitting an annual rate of 4.97 million units. This put them up 9.7% over a year ago, reaching their highest sales pace since November 2009, when they were helped along by an $8,000 homebuyer tax credit. No government largesse is needed now to lure buyers, and the median price of an existing home is up 11.0% from a year ago, the supply at 5.2 months.

April was a sweet month for new home purchases too. New home sales were up 2.3%, to a 454,000 annual rate, and are now up a solid 29.0% versus a year ago.The faster sales pace meant that a 5,000-unit increase in inventories did not push out the 4.1 months' supply. With the number of completed new homes at a record low, buyers are moving quickly. The median new home selling price is up 14.9% over a year ago. In addition, the FHFA index of prices for all homes financed by conforming mortgages was up 1.3% in March and is up 7.2% over a year ago.

BUSINESS TIP OF THE WEEK... Getting new business is key to every business. Each day, focus as soon as you can on doing one thing to bring in new clients or to create new opportunities with the clients you have.

>> Review of Last Week

APPLYING THE BRAKES... After four record-setting weeks in a row for stocks, investors put on the brakes, all indexes closing down for the week. Fed Chairman Ben Bernanke's Congressional testimony, plus comments in the FOMC meeting minutes, made Wall Streeters worry that the Fed will begin tapering its bond purchases, designed to keep interest rates down and the economy heading back up. Some Fed members saw this starting in late June if the economy showed more evidence of growth, but "...views differed about what evidence would be necessary and the likelihood of that outcome."

There was plenty of reason for investor optimism going into the long holiday weekend. Friday's Durable Good Orders report showed stronger than expected demand in April for big ticket purchases. Thursday's weekly unemployment claims were down 23,000 to 340,000, while continuing claims dropped 112,000, to 2.91 million, the lowest they've been since March 2008. Other good news in a light week of data included the better than forecast April new home sales and existing home sales that were perfectly in line with predictions.
The week ended with the Dow down 0.3%, to 15303; the S&P 500 down 1.1%, to 1650; and the Nasdaq also down 1.1%, to 3459. 
Even though stocks slid, concerns that the Fed would slow its buying program kept bond prices in check. The FNMA 3.5% bond we watch ended the week down .86, at $104.18.National average mortgage rates ticked up again last week in Freddie Mac's Primary Mortgage Market Survey. They're still near historically low, well beneath levels of a year ago. The Mortgage Bankers Association's Purchase Index was down 4% for the week, but is up 10% compared to a year ago.

DID YOU KNOW?... An online real estate listing site calculated that national home prices are still 7% undervalued in Q2 of 2013. 

>> This Week’s Forecast

CONSUMERS CONFIDENT, GDP HOLDS, PENDING HOME SALES INCH AHEAD... A solid improvement in Consumer Confidence is expected for May. The 2nd Estimate of GDPis predicted to show economic growth holding at a middling 2.5%. Pending Home Salesare forecast inching up in April, indicating sales of existing homes should continue to climb.

Other items of interest include the Core PCE Prices read on inflation for April. Here the Fed should be happy to see things under control. The Chicago PMI reading of Midwest manufacturing activity is forecast up a tick for May. 

Financial markets were closed Monday in observance of Memorial Day.

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