Tuesday, July 31, 2007

Reuters: American Home Mortgage May Fold

Reuters is reporting that lender American Home Mortgage Investment Corp. may fold, unable to fund its mortgage loans. The company commanded about 2 1/2% of the U.S. mortgage market. The company's stock has stopped trading, and closed last Friday at 1.32, down from 36.36 at the end of 2006.

The Paperless Office

Try not to think about this when you hit "send": According to a recent study by AOL, 53% of Americans with wireless devices have checked their e-mail while they were in the bathroom...

Consumer Confidence Hits Six-Year High

Some good news for a change...

The Conference Board's Consumer Confidence Index, which had dipped in June, rebounded in July. The Index now stands at 112.6 (1985=100), up from 105.3 in June.
Says Lynn Franco, Director of The Conference Board Consumer Research Center: "Looking ahead, consumers are more upbeat about short-term economic prospects, mainly the result of a decline in the number of pessimists, not an increase in the number of optimists. This rebound in confidence suggests economic activity may gather a little momentum in the coming months."

Friday, July 27, 2007

NAHB Drops 2007-8 Start Forecast

National Association of Home Builders chief economist David Seiders has slashed his forecast for the housing market further to 1.42 million for 2007 and 1.45 million for 2008. Seiders says the home building recession will end in the later part of the fourth quarter of 2007 or in early 2008, but he does not think total housing starts will get back to the 1.95 million unit-level until 2010 or 2011.
He projects single-family starts to level off at 1.1 million in the fourth quarter of 2007 and build back to 1.5 million units in 2010 or 2011.
Seiders says he doesn’t think the Fed will cut its target rate in 2007 or 2008, or that there will be a surge in job growth. A typical housing recession is overcome by one of these two factors. Neither is present today nor on the horizon, Seiders says.

Wednesday, July 25, 2007

This, by You, Is Good News?

"I don't envision a 'Grapes of Wrath' scenario where we all have to pile in the family car and look for harvesting work."

--Rich Toscano, financial advisor, Pacific Capital Associates, San Diego, CA,

as quoted in the L.A. Times today.

Oy, as Ma Joad would say...

June Existing Home Sales Dip, But So Does Unsold Home Inventory

Total existing-home sales declined 3.8% to a seasonally adjusted annual rate of 5.75 million units in June from a downwardly revised level of 5.98 million in May, and are 11.4% below the 6.49 million-unit pace in June, 2006, according to the National Association of Realtors. Existing single-family home sales fell 3.5% from the pace set in May to a seasonally adjusted annual rate of 5.01 million, and are 12.1% below the 5.70 million-unit level registered in June, 2006.
According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 6.66% in June, up from 6.26% in May; the rate was 6.68% in June 2006.
“Two bright spots in the June report are a decline in housing inventory and a modest gain in home prices,” NAR senior economist Lawrence Yun said. “Although we’ve seen seasonal month-to-month price increases over the past four months, this is the first time in 11 months that the median home price is higher than the year-ago price.”
The national median existing-home price for all housing types was $230,100 in June, up 0.3% from June 2006 when the median was $229,300.
Total housing inventory fell 4.2% at the end of June to 4.2 million existing homes available for sale, which represents an 8.8-month supply at the current sales pace

Tuesday, July 24, 2007

Greatish Moments in Kitchen/Bath Industry

Forty-eight years ago today, July 24, 1959, in a kitchen display at an international trade show, then-Vice President Richard Nixon and then-Soviet Premier Nikita Khruschev found themselves holding what came to be called the "kitchen debate." For an interesting story of how it came to be videotaped way back in 1959, click here.

Monday, July 23, 2007

Bain Buys American Standard's Bath & Kitchen Business for $1.76 Billion

American Standard is selling its bath and kitchen business to investors advised by private equity firm Bain Capital Partners LLC for $1.755 billion.
The company said the sale of the bath unit, which has annual sales of $2.4 billion and sells plumbing products under names such as American Standard, Jado, Ideal-Standard and Porcher, is expected to be completed in the fourth quarter.
Venesta Washroom Systems, a business that had been part of the bath and kitchen unit, was sold earlier this year, bringing total proceeds for the bath and kitchen sale to $1.92 billion.
American Standard was formed in 1929, when the American Radiator Company merged with The Standard Sanitary Manufacturing Company. In the 1930's it was estimated to supply fixtures and fittings for about half of all the homes in the U.S. and Europe. Among its innovations are the one-piece toilet, enamel cast-iron tubs, and combination faucets. It has 26,000 employees and 54 production facilities in 23 countries worldwide.

Future of Home Improvement? Better Service

Service is the key to future success in the home improvement business, according to a new study from the Home Improvement Research Institute and Yankelovich. Some 86% of consumers polled say that the prices they pay now should entitle them to the highest level of customer service, and 67% say they will walk out on a store giving them bad service, even if that store has exactly what they are looking for.This indicates that salespeople should reposition themselves as “personal shoppers,” offering easy-to-use, time-saving tools to help homeowners plan and complete their home improvement projects. The survey suggests that after-purchase, personalized support is an opportunity for future business.
Households are rapidly changing. In 1970, just 23% of all U.S. households were single family or one-person households, but by 2004 that number had risen to 35%. By way of contrast, married households with kids made up 40% of the total in 1970 but just 23% in 2004. During that span, the number of U.S. households nearly doubled, from 63 million in 1970 to 112 million in 2004.
The study suggest that kitchen and bath dealers should look to single women as a huge source of growth, empowering them to get their projects done.
And the way to empower them is to give them greater confidence and supply information on demand.
In 2004, 59% of consumers said they felt overwhelmed by the amount of information on home improvement that was available; today, just 47% feel that way. Some 74% say they always know how to find the information they need, but 62% say they hate the work involved in getting that information.