by Calculated Risk on 2/21/2022 12:53:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Final Look at Local Housing Markets in January

A brief excerpt:

This update adds Columbus, Illinois, Indiana, Miami, New York and Phoenix.
...
Here is a summary of active listings for these housing markets in January. Inventory was down 10.2% in January month-over-month (MoM) from December, and down 31.8% year-over-year (YoY).

Inventory almost always declines seasonally in January, so the MoM decline is not a surprise. Last month, these markets were down 29.4% YoY, so the YoY decline in January was larger than in December. This isn’t indicating a slowing market.

Notes for all tables:

1. New additions to table in BOLD.

2. Northwest (Seattle), North Texas (Dallas), and Santa Clara (San Jose), Jacksonville, Source: Northeast Florida Association of REALTORS®

3. Totals do not include Atlanta, Denver, Minneapolis (included in state totals).

There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/

by Calculated Risk on 2/21/2022 10:07:00 AM

Tracking existing home inventory is very important in 2022.

Inventory usually declines in the winter, and this is a new record low for this series.

Click on graph for larger image in graph gallery.

This inventory graph is courtesy of Altos Research.

As of February 18th, inventory was at 248 thousand (7-day average), compared to 334 thousand for the same week a year ago.  That is a decline of 25.8%. 

 A week ago, inventory was at 250 thousand, and was down 27.5% YoY.    

Inventory was down 0.7% from the previous week.

Compared to the same week in 2020, inventory is down 65.7% from 723 thousand.

Last year inventory bottomed seasonally in April 2021 - very late in the year - usually inventory bottoms by February. An early key in 2022 will be to watch if inventory bottoms earlier this year.

And here is a table of the year-over-year change by week since the beginning of the year. A possible early indicator might be if the YoY decline is less each week.

Week Ending	YoY Change
12/31/2021	-30.0%
1/7/2022	-26.0%
1/14/2022	-28.6%
1/21/2022	-27.1%
1/28/2022	-25.9%
2/4/2022	-27.9%
2/11/2022	-27.5%
2/18/2022	-25.8%

Mike Simonsen discusses this data regularly on Youtube.

by Calculated Risk on 2/21/2022 08:50:00 AM

These indicators are mostly for travel and entertainment.    It is interesting to watch these sectors recover as the pandemic subsides.

There was a clear negative impact from the omicron variant of COVID that is starting to ease.

----- Airlines: Transportation Security Administration -----
The TSA is providing daily travel numbers.

This data is as of February 19th.

Click on graph for larger image.

This data shows the 7-day average of daily total traveler throughput from the TSA for 2019 (Light Blue), 2020 (Black), 2021 (Blue) and 2022 (Red).

The dashed line is the percent of 2019 for the seven-day average.

The 7-day average is down 17.0% from the same day in 2019 (83.0% of 2019).  (Dashed line)

Air travel declined in early 2022 (omicron / weak business travel) but appears to be picking up (both seasonally and less COVID).

----- Restaurants: OpenTable -----
The second graph shows the 7-day average of the year-over-year change in diners as tabulated by OpenTable for the US and several selected cities.

IMPORTANT: OpenTable notes that all data is compared to 2019. Thanks!

Thanks to OpenTable for providing this restaurant data:

This data is updated through February 19, 2022.

This data is "a sample of restaurants on the OpenTable network across all channels: online reservations, phone reservations, and walk-ins. For year-over-year comparisons by day, we compare to the same day of the week from the same week in the previous year."

Dining was mostly moving sideways but declined during the winter wave of COVID and is now increasing.  The 7-day average for the US is down 3% compared to 2019.

----- Movie Tickets: Box Office Mojo -----
This data shows domestic box office for each week and the median for the years 2016 through 2019 (dashed light blue).  

Black is 2020, Blue is 2021 and Red is 2022.  

The data is from BoxOfficeMojo through February 17th.

Note that the data is usually noisy week-to-week and depends on when blockbusters are released.

Movie ticket sales were at $81 million last week, down about 57% from the median for the week. 

----- Hotel Occupancy: STR -----
This graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

The red line is for 2022, black is 2020, blue is the median, and dashed light blue is for 2021.

This data is through February 12th. The occupancy rate was down 14.0% compared to the same week in 2019.

The 4-week average of the occupancy rate is below the median rate for the previous 20 years (Blue).

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

The 4-week average of the occupancy rate will increase seasonally over the next few months. The key question is: How much business travel will return?

----- Transit: Apple Mobility -----
This graph is from Apple mobility. From Apple: "This data is generated by counting the number of requests made to Apple Maps for directions in select countries/regions, sub-regions, and cities." This is just a general guide - people that regularly commute probably don't ask for directions.

This data is through February 19th 

for the United States and several selected cities.

The graph is the running 7-day average to remove the impact of weekends.

IMPORTANT: All data is relative to January 13, 2020. This data is NOT Seasonally Adjusted. People walk and drive more when the weather is nice, so I'm just using the transit data.

According to the Apple data directions requests, public transit in the 7-day average for the US is at 110% of the January 2020 level. 

----- New York City Subway Usage -----
Here is some interesting data on New York subway usage (HT BR).

This graph is from Todd W Schneider. 

This graph shows how much MTA traffic has recovered in each borough (Graph starts at first week in January 2020 and 100 = 2019 average).

Manhattan is at about 36% of normal.

This data is through Friday, February 18th.

He notes: "Data updates weekly from the MTA’s public turnstile data, usually on Saturday mornings".

by Calculated Risk on 2/20/2022 10:05:00 AM

Along with the monthly housing starts for January last week, the Census Bureau released Housing Units Started by Purpose and Design through Q4 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 down 9% in Q4 2021 compared to Q4 2020.

Owner built starts (orange) were up 11% year-over-year.

Condos built for sale increased and are still low.

The 'units built for rent' (blue) and were up 35% in Q4 2021 compared to Q4 2020.

The recent housing boom had been mostly in single family homes 'built for sale', but 'built for rent' has been picking up.

by Calculated Risk on 2/19/2022 02:11:00 PM

At the Calculated Risk Real Estate Newsletter this week:

• Existing-Home Sales Increased to 6.50 million in January

• January Forecast and 4th Look at Local Housing Markets Lawler forecast, Adding Austin, Boston, California, Colorado, Des Moines, Minneapolis, Rhode Island and Washington, D.C.

• January Housing Starts: Most Housing Units Under Construction Since 1973 Housing Starts Decreased to 1.638 million Annual Rate in January

• Thoughts on Housing Supply and Demand With 30-year mortgage rates above 4%

• The Housing Bubble and Mortgage Debt as a Percent of GDP

• 3rd Look at Local Housing Markets in January Adding Albuquerque, Atlanta, Colorado, Georgia, Jacksonville, Minnesota, Sacramento, Santa Clara and South Carolina

This is usually published several times a week, and provides more in-depth analysis of the housing market.

The blog will continue as always!

You can subscribe at https://calculatedrisk.substack.com/  Most content is available for free, but please subscribe!.

by Calculated Risk on 2/19/2022 08:11:00 AM

The key reports this week are January New Home sales and the second estimate of Q4 GDP.

Other key reports include Case-Shiller house prices and Personal Income and Outlays for January.

For manufacturing, the February Richmond and Kansas City manufacturing surveys will be released.

----- Monday, February 21st -----
All US markets will be closed in observance of Washington's Birthday.

----- Tuesday, February 22nd -----
9:00 AM: FHFA House Price Index for December 2021. This was originally a GSE only repeat sales, however there is also an expanded index.

9:00 AM: S&P/Case-Shiller House Price Index for December.

This graph shows the year-over-year change for the Case-Shiller National, Composite 10 and Composite 20 indexes, through the most recent report (the Composite 20 was started in January 2000).

The consensus is for a 18.2% year-over-year increase in the Comp 20 index for December.

10:00 AM: Richmond Fed Survey of Manufacturing Activity for February.

----- Wednesday, February 23rd -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

During the day: The AIA's Architecture Billings Index for January (a leading indicator for commercial real estate).

----- Thursday, February 24th -----
8:30 AM: The initial weekly unemployment claims report will be released.  The consensus is for a decrease to 240 thousand from 248 thousand last week.

8:30 AM: Gross Domestic Product, 4th quarter 2021 (Second estimate). The consensus is that real GDP increased 7.0% annualized in Q4, up from the advance estimate of 6.9%.

8:30 AM ET: Chicago Fed National Activity Index for January. This is a composite index of other data.

10:00 AM: New Home Sales for January from the Census Bureau.

This graph shows New Home Sales since 1963.

The dashed line is the sales rate for last month.

The consensus is that new home sales decreased to 807 thousand SAAR, down from 811 thousand in December.

11:00 AM: the Kansas City Fed manufacturing survey for February.

----- Friday, February 25th -----
8:30 AM ET: Personal Income and Outlays for January. The consensus is for a 0.3% decrease in personal income, and for a 1.5% increase in personal spending. And for the Core PCE price index to increase 0.5%.

8:30 AM: Durable Goods Orders for January from the Census Bureau. The consensus is for a 0.7% increase in durable goods orders.

10:00 AM: Pending Home Sales Index for January. The consensus is for a 0.5% increase in the index.

10:00 AM: University of Michigan's Consumer sentiment index (Final for February). The consensus is for a reading of 61.7.

by Calculated Risk on 2/18/2022 08:45:00 PM

On COVID (focus on hospitalizations and deaths):

COVID Metrics
	Now	Week Ago	Goal
Percent fully Vaccinated	64.6%	---	≥70.0%1
Fully Vaccinated (millions)	214.6	---	≥2321
New Cases per Day3	112,653	188,440	≤5,0002
Hospitalized3	80,185	107,772	≤3,0002
Deaths per Day3	1,998	2,344	≤502
1 Minimum to achieve "herd immunity" (estimated between 70% and 85%). 2my goals to stop daily posts, 37-day average for Cases, Currently Hospitalized, and Deaths 🚩 Increasing 7-day average week-over-week for Cases, Hospitalized, and Deaths ✅ Goal met.

Click on graph for larger image.

This graph shows the daily (columns) and 7-day average (line) of deaths reported.

New cases, hospitalizations and deaths are now declining.  

Note: Hospitalizations have not been updated for a few days and are probably lower than in the table.

by Calculated Risk on 2/18/2022 03:09:00 PM

From CoStar: STR: US Hotel Industry Reaches Highest Performance Since December

U.S. weekly hotel performance advanced to its highest levels since December, according to STR‘s latest data through Feb. 12.

Feb. 6-12, 2022 (percentage change from comparable week in 2019*):

• Occupancy: 54.6% (-14.0%)
• Average daily rate (ADR): $133.72 (+1.3%)
• Revenue per available room (RevPAR): $73.00 (-12.9%)

*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 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 2022, black is 2020, blue is the median, and dashed light blue is for 2021.

The 4-week average of the occupancy rate is below the median rate for the previous 20 years (Blue).

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

The 4-week average of the occupancy rate will increase seasonally over the next few months.

by Calculated Risk on 2/18/2022 01:45:00 PM

Here are a few early forecasts for Q1 GDP.

From BofA:

In the second release of 4Q GDP, we expect a revision upwards to 7.5% qoq saar growth from 6.9%. We are now tracking 2.5% for 1Q (prev 2.0%), following the retail sales beat [February 17 estimate]
emphasis added

From Goldman Sachs:

We left our Q1 GDP tracking estimate unchanged at +2.0% (qoq ar). [February 17 estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2022 is 1.3 percent on February 17, down from 1.5 percent on February 16. After this morning’s housing starts report from the US Census Bureau, the nowcast of first-quarter real residential investment growth decreased from 4.7 percent to 0.3 percent. [February 17 estimate]

by Calculated Risk on 2/18/2022 11:31:00 AM

Today, in the CalculatedRisk Real Estate Newsletter: Existing-Home Sales Increased to 6.50 million in January

Excerpt:

This graph shows existing home sales by month for 2021 and 2022.

Sales declined 2.3% year-over-year compared to January 2021. This was the sixth consecutive month with sales down year-over-year.
...
[and on inventory] According to the NAR, inventory decreased to 0.86 million in January from 0.88 million in December. Inventory is now at a record low.

There is much more in the post.  You can subscribe at https://calculatedrisk.substack.com/ (Most content is available for free, so please subscribe).