September 12, 2011 (Chris Moore)
Economic activity continued to expand at a modest pace with some Districts of the Federal Reserve reporting mixed or weakening activity according to the latest edition of the Beige Book released by the Federal Reserve.
Of the Twelve Federal Reserve Districts, five Districts reported economic activity as either modest or slightly expanding, three Districts reported economic activity at a subdued or at a sluggish pace, and the remaining Districts reported slowing or weaker overall economic activity.
Several Districts reported that many contacts had downgraded or had become more cautious about their near term economic outlook due to the recent stock market volatility and increased economic uncertainty.
Real estate remained weak overall with the Boston, Atlanta, Minneapolis and Dallas Districts reporting an increase in home sales over year ago levels. The remaining Districts reported stable or slower sales since the last Beige Book. Foreclosure backlogs were cited in several Districts as weighing down the housing market in their areas.
Housing construction activity remained weak and stagnant except in the Minneapolis and Kansas City Districts. Apartment building showed improvement in New York, Philadelphia, and Cleveland with several Districts also reporting improvements in home remodeling activity.
Most Districts reported flat or declining home sales prices except for New York, which reported prices in many areas edged higher though below year ago prices.
Housing inventory levels were reported to be rising in several Districts with demand for apartment space increasing in San Francisco and Dallas.
Loan demand was reported as stable or slightly weaker in most Districts since the last report with only New York and Cleveland reporting an increased demand for residential mortgages.
Loan quality was generally improved in most Districts and credit standards were largely unchanged since the last report. Several Districts reported reduced economic expectations for economic growth due to volatility in financial markets, a weak economic recovery, and uncertainty about financial regulations.
Tags: Federal Reserve, Beige Book, housing market, moderate economic gains, increased hiring, real estate markets, single family homes, multifamily market, construction activity