Consumer Confidence Relatively Unchanged in July

/

By Marla Martin

U.S. consumers remain optimistic: July’s confidence index is about the same as June’s, after gains in each of the prior 5 months – and the highest since Feb. 2020.

NEW YORK – The Conference Board Consumer Confidence Index was relatively unchanged in July, following gains in each of the prior five months. The Index now stands at 129.1, up from 128.9 in June.

The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – rose from 159.6 to 160.3. The Expectations Index – based on consumers’ short-term outlook for income, business, and labor market conditions – was virtually unchanged at 108.4, compared to 108.5 last month.

“Consumer confidence was flat in July but remains at its highest level since February 2020,” says Lynn Franco, senior director of economic indicators at The Conference Board. “Consumers’ appraisal of present-day conditions held steady, suggesting economic growth in Q3 is off to a strong start. Consumers’ optimism about the short-term outlook didn’t waver, and they continued to expect that business conditions, jobs and personal financial prospects will improve.”

Franco says short-term inflation expectations eased slightly but they’re still elevated. “Spending intentions picked up in July, with a larger percentage of consumers saying they planned to purchase homes, automobiles, and major appliances in the coming months.,” she added, and “consumer spending should continue to support robust economic growth in the second half of 2021.”

Present situation

Consumers’ appraisal of current business conditions improved slightly in July.

• 26.4% of consumers said business conditions are “good,” up from 25.2%.
• 19.3% of consumers said business conditions are “bad,” up from 19.1%.

Consumers’ assessment of the labor market was relatively flat.

• 54.9% of consumers said jobs are “plentiful,” up from 54.7%.
• 10.5% of consumers said jobs are “hard to get,” unchanged from June.

Expectations six months from now

Consumers’ optimism about the short-term business conditions outlook eased slightly in July.

• 33.4% of consumers expect business conditions will improve, down from 33.7%.
• 10.5% expect business conditions to worsen, down from 10.8%.

Consumers were mixed about the short-term labor market outlook.

• 27.7% of consumers expect more jobs to be available in the months ahead, up from 26.6%.
• Conversely, 16.8% anticipate fewer jobs, up from 15.7%.

Consumers remained upbeat about their short-term financial prospects.

• 20.6% of consumers expect their incomes to increase, up from 20.0%.
• Only 8.6% expect their incomes will decrease, up from 8.4%.

The monthly Consumer Confidence Survey is conducted for The Conference Board by Toluna, a technology company that delivers real-time consumer insights and market

© 2021 Florida Realtors®

Palm Coast homes for sale on canal (2).png

How Effective Is National Flood Insurance? GAO Does an Audit

/

By Kerry Smith, Florida Realtors

The government agency that oversees other agencies said that FEMA needs to inspect high-risk-flood communities more often – notably the ones in Fla. and Texas.

WASHINGTON – The U.S. Government Accountability Office (GAO) audits other government agencies to hold them accountable, and it recently completed an audit of the Federal Emergency Management Agency (FEMA) – and specifically the National Flood Insurance Program (NFIP).

Communities that participate in NFIP must mitigate possible flood damage, and rates are determined by how well they do that.

FEMA inspects communities to see how well they follow NFIP requirements. The visits include evaluations of recent construction. Until 2019, FEMA’s goal was to visit all communities considered to be high-risk for flooding every 5 years.

However, FEMA did not meet this goal in Florida or Texas in 2008-2019, citing a lack of resources according to the GAO. As a result, many high-risk communities received only one visit in this period – and some weren’t visited at all.

“Without regular monitoring, FEMA’s ability to ensure communities comply with requirements is limited,” GAO reported. Without the inspections, FEMA can’t track violations or deficiencies, or whether the community resolved earlier cited issues.

In Florida, the GAO found that records on visits remained open for years, and FEMA staff weren’t able to say whether that “indicated unresolved deficiencies or incomplete recordkeeping.”

One key problem GAO said was a community’s ability to assess damage on a property after a flood, and whether it’s damaged by 50% or more of its value to ensure it’s then rebuilt to current NFIP standards.

However, “FEMA generally does not collect or analyze the results of these assessments, limiting its ability to ensure the process operates as intended,” the GAO report said. “Furthermore, FEMA has not clarified how communities can access NFIP claims data. Such data would help communities target substantial damage assessments after a flood.”

The GAO made four recommendations to FEMA:

  • Assess different approaches for ensuring compliance with NFIP requirements

  • Ensure data on community visits are up-to-date and complete

  • Ensure communities collect data on substantial damage assessments

  • Clarify policies on data sharing between FEMA and NFIP communities

  • FEMA said it agreed with the GAO’s recommendations.

The text of the GAO report is available online.

© 2020 Florida Realtors®

Palm Coast Waterfront Properties for sale.png