Lowe’s Earnings Preview: Slow Home Sales Could Impact Q1 Results – Forbes

The average interest rate on a 30-year fixed-rate mortgage this year has been 4.3%, up from 3.45% last year in April.Lending rates have been on a rise since last year, fueled by the Federal Reserves announcement of reduction in bond purchases, which had kept the long-term interest rates low. High mortgage prices, coupled with high housing rates, are hurting consumer affordability. However, according to Blue Chip Economic Indicators, net disposable income is expected to increase by 2.3% this year, up from a small 0.7% growth in 2013.Lowes focuses more on higher priced premium goods, as compared to its chief competitor Home Depot. With an increase in disposable incomes, consumers might switch to premium goods and thus boost Lowes sales. In addition, the unemployment rate in the U.S. http://www.forbes.com/sites/greatspeculations/2014/05/19/lowes-earnings-preview-slow-home-sales-could-impact-q1-results/


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