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Happy Thanksgiving from MetroIntelligence and Housing Chronicles! Think you know everything about Thanksgiving from what you learned long ago in elementary school?  It’s actually a bit more complicated than you might’ve thought.

In the United States, the modern Thanksgiving holiday tradition traces its origins to a 1621 celebration at Plymouth in present-day Massachusetts.   However, there is also evidence for an earlier harvest celebration on the continent by Spanish explorers in Florida during 1565, as well as thanksgiving feasts in the Virgina Colony.

The initial thanksgiving observance at Virginia in 1619 was prompted by the colonists’ leaders on the anniversary of the settlement. The 1621 Plymouth feast and thanksgiving was prompted by a good harvest. In later years, the tradition was continued by civil leaders such as Gov. Bradford, who planned a thanksgiving celebration and fast in 1623. While initially the Plymouth colony did not have enough food to feed half of the 102 colonists, the Wampanoag Native Americans helped the Pilgrims by providing seeds and teaching them how to fish.   Still, the practice of holding an annual harvest festival like this did not become a regular affair in New England until the late 1660s.

According to historian Jeremy Bangs, director of the Leiden American Pilgrim Museum, the Pilgrims may have been influenced by watching the annual services of Thanksgiving for the relief of the siege of Leiden, The Netherlands, in 1574, while they were staying in Leiden.

Thanksgiving in North America had originated from a mix of European and Native traditions.Typically in Europe, festivals were held before and after the harvest cycles to give thanks for a good harvest, and to rejoice together after much hard work with the rest of the community.  At the time, Native Americans had also celebrated the end of a harvest season.

When Europeans first arrived to the Americas, they brought with them their own harvest festival traditions from Europe, celebrating their safe voyage, peace and good harvest.Though the origins of the holiday in both Canada and the United States are similar, Americans do not typically celebrate the contributions made in Newfoundland, while Canadians do not celebrate the contributions made in Plymouth, Massachusetts.
Thanksgiving in the United States, much like in Canada, was observed on various dates throughout history. 

The dates of Thanksgiving in the era of the Founding Fathers until the time of Lincoln had been decided by each state on various dates. The first Thanksgiving celebrated on the same date by all states was in 1863 by presidential proclamation. The final Thursday in November had become the customary date of Thanksgiving in most U.S. states by the beginning of the 20th century.

And so, in an effort by President Abraham Lincoln (influenced by the campaigning of author Sarah Josepha Hale who wrote letters to politicians for around 40 years trying to make it an official holiday), to foster a sense of American unity between the Northern and Southern states, proclaimed the date to be the final Thursday in November.

It was not until December 26, 1941, that the unified date changed to the fourth Thursday (and not always final) in November -- this time by federal legislation. President Franklin D. Roosevelt, after two years earlier offering his own proclamation to move the date earlier, with the reason of giving the country an economic boost, agreed to sign a bill into law with Congress, making Thanksgiving a national holiday on the fourth (not final) Thursday in November.

Source:  Wikipedia

Please click here to see the edition of BuilderBytes for 11/25/14 on the Web.

In this issue of the MetroIntelligence Economic Update, I covered the following indicators:
  • Philadelphia Fed Business Outlook Survey increased notably in November
  • Mortgage applications rise by nearly five percent as rates remain mostly stable in latest survey
Want to advertise in the newsletter and reach over 130,000 readers? Contact National Sales Manager Nick Cosan at nkosan@penpubinc.com.

Last year, I wrote about a housing rebound that seemed to finally have solid legs after a few false starts since the Great Recession.  The good news for 2014 is that both the economy and the housing market have continued their slow yet gradual climb back to normal.

Indeed, the NAHB’s Leading Markets Index, which measures how well metropolitan areas are performing relative to their last ‘normal’ market, rose to .90 in the third quarter of 2014.  This means that the combination of permits, prices and employment levels are back to 90 percent of where they should be at a national level, although most of this rebound has been due to new permits and rising prices more than robust, uniform employment gains.

Still, the national job market continues to improve strongly, adding well over 200,000 jobs per month for most of the year, thereby bringing the official unemployment rate down to 5.8 percent.  Since this rate of growth is about double the pace required to reduce unemployment and under-employment, wages could soon come under pressure to rise after years of being stuck near neutral, which could counter-act the impact of future interest rate hikes and higher housing prices.

At the same time, the economic rebound has not been consistent across the country, with much stronger job growth in those states which have benefitted from the domestic energy boom, military or agricultural spending, or include small college towns.   Conversely, those states with weaker labor markets – such as Arizona, Nevada, Rhode Island or New Jersey – also continue to exhibit weaker housing fundamentals.

Nonetheless, from a confidence standpoint, both builders and consumers have been reporting positive attitudes, with the NAHB Housing Market Index rising four points in November to 58, with even stronger gains for the index measuring current sales conditions.  Consumer sentiment has recently been even stronger, rising in November to more than a seven-year high even though respondents don’t expect future income gains to keep up with inflation.

While overall housing starts did take an unexpected but small dip in October from the previous month, they still rose by nearly eight percent year-over-year.  At the same time, starts for single-family homes were still up by just over four percent between September and October to the highest rate since November of 2013.   But it was really building permits – often a forward-looking indicator of market activity – which revealed gradually building strength for housing, rising by nearly five percent in October to the highest level in nearly 6.5 years.

New home sales have also continued to climb, rising by 17 percent between September of 2013 and 2014 to an annual rate of 467,000 units, which would take 5.3 months to sell at current sales rates, down from 5.5 months the previous year.  New home median prices, however, fell to $259,000 from $269,800 during that same time period, most likely due to a higher percentage of sales in the South.

For existing homes, sales rose in October for the second straight month after a challenging spring and relatively flat summer, reaching their highest annual rate since September of 2013 as well as being above year-over-year levels for the first time in over a year.  At the same time, inventory levels fell to a 5.1-month supply, which was the lowest supply timeline since last March.  Existing home prices reached $208,300 in October, up by 5.5 percent over the same month of 2013 and marking the 32ndstraight month of year-over-year price gains.

The remodeling market is also strong, with the NAHB Remodeling Market Index matching its record high of 57 in the third quarter of 2014 even after a dip in activity earlier in the year due to an unusually harsh winter.

Looking ahead to 2015, forecasts are generally calling for continuing expansion for both the U.S. economy and its housing market.  U.S. GDP is expected to sustain its 3.0 percent growth rate due to ongoing fiscal stimulus, lower energy costs (especially for gasoline), slowly easing credit conditions and more positive business and consumer confidence.  However, a stronger dollar will likely dampen exports, and the Fed will probably start boosting its Federal funds rate sometime in 2015.

As for housing, look for housing starts to rise by another 20 percent in 2015, with most of that increase noted for single-family homes built to fulfill a large supply of pent-up supply over the past few years.  Still, as household formations increase in 2015, look for the rental market in urban markets to remain tight as rent growth exceeds inflation.

Please click here to see the edition of BuilderBytes for 11/21/14 on the Web.

In this issue of the MetroIntelligence Economic Update, I covered the following indicators:
  • Existing home sales rose in October to highest annual rate in over a year
  • Leading Economic Index rose sharply in October as economic expansion continues
  • CPI unchanged in October, up by 1.7 percent over previous 12 months
  • Initial unemployment claims fall by 2,000 in latest report
Want to advertise in the newsletter and reach over 130,000 readers? Contact National Sales Manager Nick Cosan at nkosan@penpubinc.com.

      
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