U.S. Retailers on Pace for Best Holiday Season in Years Surging online orders and last-minute shoppers helped retailers make up for a slow start to the holiday-shopping season, fueling hopes that higher wages, the rising stock market, and lower food and gas prices prompted Americans to spend more.
(…) “[Americans] are shopping at a rate not seen since the mid-2000s.” [Craig Johnson, president of Customer Growth Partners]
The firm raised its holiday-sales growth forecast to 4.9% from an initial estimate of 4.1% growth. That pace, according to the firm, would be the fastest growth rate since a 6.1% increase in 2005. Customer Growth Partners’ forecasts—which excludes auto, car parts, fuel and restaurant sales—are based on a weekly in-house survey of retailers across the country combined with broader economic indicators and historical data.
Mastercard’s SpendingPulse survey found that total retail sales, excluding automobile and gas sales, rose 4% from Nov. 1 to Dec. 24, though its results found that the days preceding Christmas were weaker than expected. The survey highlighted men’s apparel and home furnishings as strong points, while jewelry sales fell from a year ago. (…)
RetailNext Inc. a brick-and-mortar retail analytic firm, said net sales at traditional stores fell by 10% from a year earlier during December, with shopper traffic plunging nearly 15%. Those results were partially buoyed by a burst of spending in the final days before Christmas, when sales rose 6.5%, according to RetailNext. (…)
RetailNext said that the average shopper shelled out nearly 11% more during the week before Christmas, offsetting a 3.9% decline in store traffic. (…)
In a sign of the surge of online shopping, United Parcel Service Inc. said it expected to ship 14% more packages this year than last, more than 700 million in total, a record level by volume. FedEx Corp. plan a 10% bump.
But peak season for the carriers isn’t over yet: UPS said it plans to ship 5.8 million packages back to retailers in the first week of January, as consumers send back unwanted items.
Frankly, I just can’t remember any spending spree led by men’s apparel and home furnishings…
(…) “I think we’re at a turning point. The numbers that we’re reporting today are October, before the Trump election, and everything looks different now,” he told Bloomberg Television’s Alix Steel and David Westin. “There might be a Trump boom coming.”
S&P CoreLogic Case-Shiller data released earlier on Tuesday showed that home prices in 20 U.S. cities maintained a steady pace of increases in October, rising by 5.1 percent, while a gauge of nationwide property values rose by the most since mid-2014. (…)
“I’m not forecasting a boom. I find it very hard to forecast at this point in our history because it’s such an important change in government and we just don’t know where it’s going,” he said. (…)
Shiller said that the rise in mortgage rates so far this year was “not a big deal yet” and may actually sow the seeds for further short-term gains in house prices.
“I don’t know how people react to rising mortgage rates,” he said. “One thought is they want to lock it in now. And that’s why we’ve had good home sales recently. And it might continue as mortgage rates rise. This thing could feed a boom. I’m not saying it will.”
“It could. It might. But it may not…Remember I said it first. But if it does not happen, I never said it will happen.”
“I don’t know how people react to rising mortgage rates,”…Hmmm…generally not very positively professor:
Even in the recent low rates era, people tend to react similarly when costs rise rapidly and meaningfully. Just the old normal…
U.S. Pending Home Sales Fell in November A gauge of upcoming home sales dropped in November, a sign of weakening momentum for the U.S. housing market headed into 2017.
The National Association of Realtors said Wednesday that its pending home sales index, which tracks contracts signed for purchases of existing homes, fell 2.5% from October to a seasonally adjusted 107.3 last month. Sales typically close within a month or two of signing.
Housing was already weakening but rising prices and mortgage rates are biting. Pending sales are 6.7% below the April peak and are weak across the country with the possible exception of the Northeast where sales are up 5.7% YoY. (Chart from Haver Analytics)
- The Redfin Housing Demand Index, based on thousands of Redfin customers requesting home tours and writing offers, declined 7.3 percent from October to a seasonally-adjusted level of 94 in November.