Here are some economic nuggets from the past two weeks’ news headlines and industry publications.

  1. The nation went over the fiscal cliff and bungeed back up. Congress finally passed, and the president signed into law, legislation resolving the fiscal cliff issues — at least for the moment. The tax issue was permanently resolved. The spending sequester was delayed for two months. The Social Security payroll tax holiday was not extended, meaning the payroll tax rate increased 2.0% as of January 1 of this year.

  2. Income tax rates for families with adjusted gross income (AGI) taxable income (TI) of less than $450,000 and individuals with AGI (TI) of less than $400,000 were unchanged from recent rates. Tax rates for income at and above those levels returned to the rates prior to the George W. Bush-era tax cuts.

  3. The alternative minimum tax (AMT) was permanently patched (finally!). Since triggers for the AMT were not previously indexed for inflation, Congress has had to pass a temporary patch each year to prevent thousands of taxpayers not intended to be subject to the AMT from falling under the AMT.

  4. Nothing was done about the federal debt ceiling.

  5. Total commercial construction spending ended seven consecutive monthly increases, slipping 0.3% in November to $866.0 billion at a seasonally adjusted annual rate (SAAR) due to a decline in nonresidential construction spending. However, year-to-date not seasonally adjusted (NSA) spending increased 9.2% over the same period in 2011. The November spending figure includes the following:
    • Nonresidential construction spending fell 1.2% to $295.8 billion, but was 6.0% higher on a year-to-date basis from 2011
    • Heavy engineering construction spending was unchanged at $268.3 billion, but was 8.2% higher on a year-to-date from 2011
    • New residential construction spending increased 1.2% to $173.1 billion and rose 18.7% on a year-to-date basis from 2011
  1. The Bureau of Economic Analysis (BEA) released its third estimate of third quarter real (inflation-adjusted) gross domestic product (GDP) revising growth from 2.7% (SAAR) to 3.1%.

  2. The estimate of investment in nonresidential structures for the GDP accounts improved in the sense that it was unchanged in the third quarter as opposed to the previous estimate of a 1.1% drop. 
  4. Single-family housing starts fell 4.1% to 565,000 (SAAR) in November from 589,000 in October. However, year-to-date NSA starts were up 24.5% compared to the same period in 2011. Single-family housing permits inched 0.4% higher to 568,000 from 566,000 in October and were 22.7% higher on a year-to-date basis.
  6. New single-family home sales jumped 4.4% to 377,000 (SAAR) in November after falling 3.5% in October to 361,000. November sales were the highest they have been since April 2010 when a homebuyer tax credit was available. Year-to-date NSA sales were 21.0% higher compared to a year earlier.
  8. Both the 10-city and 20-city S&P/Case-Shiller® Home Price indexes increased for the ninth month in a row. The October 10-city index rose 0.6% on a seasonally adjusted (SA) basis, and the 20-city index rose 0.7%. On a year-over-year NSA basis, the 10-city index was up 3.4%, and the 20-city index was up an even stronger 4.3%. Home prices for three of the 20 cities fell in October—Boston (-0.3%), Chicago (-0.7%), and New York City (-0.2%). Meanwhile, only two cities saw prices fall on a year-over-year basis—Chicago (-1.3%) and New York City (-1.2%).
  10. The NAHB/Wells Fargo Housing Market Index (HMI) for December rose two points to 47, the eighth monthly increase in a row. The index is at its highest level since April 2006.
  12. Multifamily housing starts fell 1.0% to 296,000 (SAAR) in November after two months of robust increases—up 11.6% in October and up 26.4% in September. The 3-month moving average, which provides a better picture of multifamily starts’ underlying trend by smoothing out some of the normal month-to-month variations, was up 10.8% to 288,000—its highest level since August 2008. Year-to-date NSA starts were up 34.9% from the same period in 2011.
  14. The November 3-month moving average of multifamily building permits increased 4.7% to 325,000. Year-to-date NSA permits were 43.5% higher than their 2011 average.
  16. The AIA Billings Index increased for the sixth month in a row, advancing to 53.2 in November from the previous month’s 52.8. The November reading was the fourth consecutive month that the index was above 50. An index higher than 50 is an indicator of increased billings.