by Calculated Risk on 5/20/2021 03:30:00 PM

Along with the monthly housing starts for April this week, the Census Bureau released Quarterly Starts by Purpose and Design through Q1 2021.

This graph shows the NSA quarterly intent for four start categories since 1975: single family built for sale, owner built (includes contractor built for owner), starts built for rent, and condos built for sale.

Click on graph for larger image.

Single family starts built for sale (red) were up 23% in Q1 2021 compared to Q1 2020.  This was the strongest first quarter since 2006.

Owner built starts (orange) were down 13% year-over-year.

Condos built for sale decreased, and are still low.

The 'units built for rent' (blue) and were down 10% in Q1 2021 compared to Q1 2020.

The housing boom has been mostly in single family homes.

by Calculated Risk on 5/20/2021 02:11:00 PM

Note: I'm tracking data for many local markets around the U.S. I think it is especially important to watch inventory this year.  Remember sales were weak in April 2020 due to the pandemic, so the YoY sales comparison is easy.

The Arizona Regional Multiple Listing Service (ARMLS) reports ("Stats Report"):

1) Overall sales were at 9,476 in April, up 36.8% from 6,925 in April 2020.

2) Active inventory was at 4,541, down 67.3% from 13,889 in April 2020.

3) Months of supply decreased to 0.96 in April from 2.59 in April 2020. This is very low.

Inventory in April was up 3.6% from last month.

by Calculated Risk on 5/20/2021 11:19:00 AM

Note: The year-over-year occupancy comparisons are easy, since occupancy declined sharply at the onset of the pandemic. However, occupancy is still down significantly from normal levels.

The occupancy rate is down 16.4% compared to the same week in 2019.

From CoStar: STR: US Hotel Average Daily Rate Hits New Pandemic High

U.S. weekly hotel occupancy reached its second-highest level since the start of the pandemic, according to STR‘s latest data through May 15.

May 9-15, 2021 (percentage change from comparable week in 2019*):

• Occupancy: 59.1% (-16.4%)
• Average daily rate (ADR): US$113.54 (-15.4%)
• Revenue per available room (RevPAR): US$67.05 (-29.2%)

Friday/Saturday occupancy came in higher than any weekend since Valentine’s Day weekend in 2020. Additionally, ADR reached its highest point of the pandemic but was still US$20 less than the corresponding week in 2019.
emphasis added

The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.

Click on graph for larger image.

The red line is for 2021, black is 2020, blue is the median, and dashed light blue is for 2009 (the worst year on record for hotels prior to 2020).

Occupancy is now slightly above the horrible 2009 levels.

Note: Y-axis doesn't start at zero to better show the seasonal change.

by Calculated Risk on 5/20/2021 10:13:00 AM

Note: A year ago, in April 2020, the delinquency rate increased sharply (see table below).   Loans in forbearance are counted as delinquent in this survey, but those loans are not reported as delinquent to the credit bureaus.

From Black Knight: Black Knight’s First Look: Mortgage Delinquencies Decline Another 7% in April; At Current Rate of Improvement, Delinquencies to Return to Pre-Pandemic Levels By Year’s End

• The number of past-due mortgages improved again in April, as the national delinquency rate fell to 4.66% from 5.02% in March

• New delinquencies rose 23% from March's record lows, but are down 33% from April 2019, while more than 400,000 (14% of) homeowners past-due on their mortgages became current on payments

• Serious delinquencies (loans 90 or more days past due but not yet in foreclosure) saw strong improvement as well, falling by 151,000 for the month

• Nearly 1.8 million first-lien mortgages remain seriously delinquent, 1.3 million more than there were heading into the pandemic

• Both foreclosure starts and active foreclosure inventory hit new record lows once again in April as both moratoriums and borrower forbearance plan participation continue to limit activity

• Mortgage prepayments fell nearly 23% in April to their lowest level since May 2020, reflecting the impact on refinance activity of interest rate spikes earlier this year

• Black Knight’s April Originations Market Monitor report also showed that rate locks have fallen further over the past month, suggesting prepay volumes will likely be muted in the months to come
emphasis added

According to Black Knight's First Look report, the percent of loans delinquent decreased 7.1% in April compared to March, and decreased 27% year-over-year.

The percent of loans in the foreclosure process decreased 6.3% in April and were down 29% over the last year.

Black Knight reported the U.S. mortgage delinquency rate (loans 30 or more days past due, but not in foreclosure) was 4.66% in April, down from 5.02% in March.

The percent of loans in the foreclosure process decreased in April to 0.29%, from 0.30% in March.

The number of delinquent properties, but not in foreclosure, is down 900,000 properties year-over-year, and the number of properties in the foreclosure process is down 58,000 properties year-over-year.

Black Knight: Percent Loans Delinquent and in Foreclosure Process
	Apr  2021	Mar 2021	Apr 2020	Apr 2019
Delinquent	4.66%	5.02%	6.45%	3.47%
In Foreclosure	0.29%	0.30%	0.40%	0.50%
Number of properties:
Number of properties that are delinquent, but not in foreclosure:	2,500,000	2,676,000	3,400,000	1,812,000
Number of properties in foreclosure pre-sale inventory:	153,000	162,000	211,000	259,000
Total Properties	2,653,000	2,838,000	3,611,000	2,072,000

by Calculated Risk on 5/20/2021 08:36:00 AM

The DOL reported:

In the week ending May 15, the advance figure for seasonally adjusted initial claims was 444,000, a decrease of 34,000 from the previous week's revised level. This is the lowest level for initial claims since March 14, 2020 when it was 256,000. The previous week's level was revised up by 5,000 from 473,000 to 478,000. The 4-week moving average was 504,750, a decrease of 30,500 from the previous week's revised average. This is the lowest level for this average since March 14, 2020 when it was 225,500. The previous week's average was revised up by 1,250 from 534,000 to 535,250.
emphasis added

This does not include the 95,086 initial claims for Pandemic Unemployment Assistance (PUA) that was down from 103,678 the previous week.

The following graph shows the 4-week moving average of weekly claims since 1971.

Click on graph for larger image.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased to 504,750.

The previous week was revised up.

Regular state continued claims increased to 3,751,000 (SA) from 3,640,000 (SA) the previous week.

Note: There are an additional 6,605,416 receiving Pandemic Unemployment Assistance (PUA) that decreased from 7,284,088 the previous week (there are questions about these numbers). This is a special program for business owners, self-employed, independent contractors or gig workers not receiving other unemployment insurance.  And an additional 5,141,311 receiving Pandemic Emergency Unemployment Compensation (PEUC) down from 5,291,528.

Weekly claims were lower than the consensus forecast.

by Calculated Risk on 5/19/2021 09:01:00 PM

Thursday:
• At 8:30 AM ET, The initial weekly unemployment claims report will be released.  The consensus is for a decrease to 460 thousand from 473 thousand last week.

• Also at 8:30 AM, the Philly Fed manufacturing survey for May. The consensus is for a reading of 43.2, down from 50.2.

by Calculated Risk on 5/19/2021 05:59:00 PM

Note: I'm tracking data for many local markets around the U.S. I think it is especially important to watch inventory this year.  Remember sales were weak in April 2020 due to the pandemic, so the YoY sales comparison is easy. 

For for the entire state Indiana:

Closed sales in April 2021 were 7,757, up 16.6% from 6,652 in April 2020.

Active Listings in April 2021 were 6,253, down 53.1% from 13,332 in April 2020.

Months of Supply was 0.8 Months in April 2021, compared to 1.8 Months in April 2020.

Inventory in April was up 6.0% from last month.

by Calculated Risk on 5/19/2021 04:42:00 PM

Hopefully everyone is part of the solution and is getting vaccinated!

According to the CDC, on Vaccinations. Total administered: 277,290,173, as of yesterday 275,535,207. Day: 1.75 million.  (U.S. Capacity is around 4 million per day)

 
1) 60.2% of the population over 18 has had at least one dose (70% goal by July 4th).
2) 125.5 million Americans are fully vaccinated (160 million goal by July 4th)

Note: I'll stop posting this daily once all four of these criteria are met:
1) 70% of the population over 18 has had at least one dose of vaccine, and
2) new cases are under 5,000 per day, and
3) hospitalizations are below 3,000, and
4) average daily deaths under 50 (currently 567 per day).

And check out COVID Act Now to see how each state is doing. 

Over 10,500 US deaths were reported so far in May due to COVID.

Click on graph for larger image.

This graph shows the daily (columns) 7 day average (line) of positive tests reported.

This data is from the CDC.

The 7-day average is 29,526, down from 30,558 yesterday, and down sharply from the recent peak of 69,881 on April 13, 2021. This is the lowest since June 21, 2020.

The second graph shows the number of people hospitalized.

This data is also from the CDC.

The CDC cautions that due to reporting delays, the area in grey will probably increase.

The current 7-day average is 26,415, down from 27,027 reported yesterday, and still above the post-summer surge low of 23,000.

by Calculated Risk on 5/19/2021 02:04:00 PM

From the Fed: Minutes of the Federal Open Market Committee, April 27–28, 2021. A few excerpts:

In their comments about inflation, participants anticipated that inflation as measured by the 12-month change of the PCE price index would move above 2 percent in the near term as very low readings from early in the pandemic fall out of the calculation. In addition, increases in oil prices were expected to pass through to consumer energy prices. Participants also noted that the expected surge in demand as the economy reopens further, along with some transitory supply chain bottlenecks, would contribute to PCE price inflation temporarily running somewhat above 2 percent. After the transitory effects of these factors fade, participants generally expected measured inflation to ease. Looking further ahead, participants expected inflation to be at levels consistent with achieving the Committee's objectives over time. A number of participants remarked that supply chain bottlenecks and input shortages may not be resolved quickly and, if so, these factors could put upward pressure on prices beyond this year. They noted that in some industries, supply chain disruptions appeared to be more persistent than originally anticipated and reportedly had led to higher input costs. Despite the expected short-run fluctuations in measured inflation, many participants commented that various measures of longer-term inflation expectations remained well anchored at levels broadly consistent with achieving the Committee's longer-run goals.
emphasis added

by Calculated Risk on 5/19/2021 01:08:00 PM

From housing economist Tom Lawler:

While single-family home prices have recently soared and single-family rents appear to have accelerated, the “Owners’ equivalent rent of primary residence” index (OERPR) of the Consumer Price Index has shown no meaningful acceleration. The YOY gain in the OERPR in April was just 2.04%, about the same as in the previous three months.

The OERPR index attempts to measure what property owners would receive if they were to rent their home. While the “Rent of primary residence” index mainly (though not solely) reflects rents on multifamily properties, the OERPR index mainly (though not solely) reflects “imputed” rents on single-family homes. There are many issues with how the OERPR in calculated (there is an extensive literature on the subject), and many feel that that it is a lagging indicator of trends. However, it would appear as if (1) the OERPR is understating this measure of housing costs; and (2) the measure is likely to accelerate, probably significantly, during the remainder of the year.

The OERPR represents a little over 23% of the overall CPI and a little underx. 14% of the PCE price index.

CR Note: This will be something to watch.