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US homebuilder confidence soars in September

By WTOP Staff

ALEX VEIGA
AP Business Writer

U.S. homebuilders’ confidence in the market for new, single-family homes surged this month to the highest level in nearly nine years.

The brighter outlook reflects growing optimism that sales will increase over the next six months. That could potentially spur growth in home construction, a key driver of the economy.

The National Association of Home Builders/Wells Fargo builder sentiment index released Wednesday rose this month to 59, up four points from August. The index has risen four months in a row.

The latest reading is the highest since reaching 61 in November 2005, before the housing bubble burst.

Readings above 50 indicate more builders view sales conditions as good, rather than poor.

Builders’ view of current sales conditions for single-family homes, their outlook for sales over the next six months and traffic by prospective buyers each increased in the latest survey.

The optimism comes despite a steady slowdown in U.S. sales of new homes this summer. Sales fell from a seasonally adjusted annual rate of 454,000 in May to a rate of 412,000 in July.

Still, sales of new homes are running ahead of last year’s pace.

Economists project that sales accelerated in August to a rate of 429,000, according to FactSet. August sales figures are due out next week.

The U.S. economy added jobs at a solid clip through much of this year, though the gains slowed in August. Last month, employers added just 142,000 jobs, well below the 212,000 average of the previous 12 months.

The job gains this year and a pickup in home values have spurred homeowners to trade up to a nicer home. But fewer homes are being purchased by first-time homebuyers.

A mix of rising home prices, higher mortgage rates and meager wage growth has made it more difficult for would-be homebuyers to purchase a newly built home, particularly first-time buyers.

Even so, many of the largest U.S. homebuilders have posted sales gains this year.

On Wednesday, Miami-based Lennar Corp. reported that its completed home sales climbed 9 percent in the three months ended Aug. 31, while new home orders vaulted 23 percent. Its shares added $2.66, or 6.8 percent, to $41.79 in morning trading. The stock has risen 19 percent in the last 12 months.

In the latest NAHB index, which was based on responses from 317 builders, builder confidence improved nationally and on a regional basis, with readings for the Midwest, West, Northeast and South all posting gains from last month.

The index gauging current sales conditions for single-family homes climbed five points to 63, the highest level since December. The builders’ outlook for sales over the next six months rose two points to 67. The last time it was higher was a year ago.

Meanwhile, a measure of traffic by prospective buyers increased five points to 47, the highest level since October 2005.

Housing, while still a long way from the boom of several years ago, has been recovering over the past two years.

Though new homes represent only a fraction of the housing market, they have an outsize impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to NAHB data.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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