RSS Feed by Calculated Risk on 6/27/2022 09:00:00 PM
Monday, June 27, 2022
Tuesday: Case-Shiller House Prices
From Matthew Graham at Mortgage News Daily: Mortgage Rates Moderately Higher to Start The Week
As has been the case many times during the 2022 rate spike, there is a much higher degree of variation between lenders compared to more stable times for rates. The average lender was only moderately higher when it comes to mortgage rate quotes today. Notably, the bond market suggested a bigger jump. The actual jump may have been smaller due to more conservative rate-setting strategies among mortgage lenders on Friday afternoon. [30 year fixed 5.88%]Tuesday:
emphasis added
• At 9:00 AM ET, S&P/Case-Shiller House Price Index for April. The consensus is for a 21.0% year-over-year increase in the Comp 20 index for April.
• At 9:00 AM, FHFA House Price Index for April 2021. This was originally a GSE only repeat sales, however there is also an expanded index.
• At 10:00 AM, Richmond Fed Survey of Manufacturing Activity for June.
On COVID (focus on hospitalizations and deaths):
| COVID Metrics | ||||
|---|---|---|---|---|
| Now | Week Ago | Goal | ||
| Percent fully Vaccinated | 66.9% | --- | ≥70.0%1 | |
| Fully Vaccinated (millions) | 222.1 | --- | ≥2321 | |
| New Cases per Day3🚩 | 100,674 | 98,301 | ≤5,0002 | |
| Hospitalized3 | 22,861 | 24,833 | ≤3,0002 | |
| Deaths per Day3🚩 | 290 | 289 | ≤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.
Average daily deaths bottomed in July 2021 at 214 per day.
Freddie Mac: Mortgage Serious Delinquency Rate decreased in May
by Calculated Risk on 6/27/2022 04:54:00 PM
Freddie Mac reported that the Single-Family serious delinquency rate in May was 0.80%, down from 0.85% April. Freddie's rate is down year-over-year from 2.01% in May 2021.
Freddie's serious delinquency rate peaked in February 2010 at 4.20% following the housing bubble and peaked at 3.17% in August 2020 during the pandemic.
These are mortgage loans that are "three monthly payments or more past due or in foreclosure".
Click on graph for larger image
Mortgages in forbearance are being counted as delinquent in this monthly report but are not reported to the credit bureaus.
This is very different from the increase in delinquencies following the housing bubble. Lending standards have been fairly solid over the last decade, and most of these homeowners have equity in their homes - and they will be able to restructure their loans once (if) they are employed.
The serious delinquency rate was at 0.60% just prior to the pandemic - almost back.
Housing: Inventory will Tell the Tale; Altos Research Reports Inventory Above Peak in 2021
by Calculated Risk on 6/27/2022 10:23:00 AM
Today, in the Calculated Risk Real Estate Newsletter: Housing: Inventory will Tell the Tale
Brief excerpt:
The first question I’m always asked about housing is What will happen with house prices? and then When will House Price Growth Slow? The exact impact on prices is uncertain (although I tried to answer both questions in the above links), but I believe one thing is certain: inventory will tell the tale!You can subscribe at https://calculatedrisk.substack.com/.
That is why I watch inventory closely. ...
This morning Altos Research released inventory data as of June 24th showing that current inventory is above the peak in 2021.
...
Here is a graph of the inventory change vs 2021, 2020 (milestone 3 above) and 2019 (milestone 4). The blue line is the year-over-year data, the red line is compared to two years ago, and dashed purple is compared to 2019.
Two years ago (in 2020) inventory was declining all year, so the two-year comparison will get easier all year. Based on recent increases in inventory, my current estimate is inventory will be up compared to 2020 in Q3 of this year (in the next few months), and back to 2019 levels at the beginning of 2023.
Inventory will tell the tale!
NAR: Pending Home Sales Increased 0.7% in May
by Calculated Risk on 6/27/2022 10:04:00 AM
From the NAR: Pending Home Sales Edge Higher 0.7% in May
Pending home sales crept higher in May, ending a six-month streak of declines, according to the National Association of Realtors®. Regionally, month-over-month results were mixed as the Northeast and South experienced increases while the Midwest and West posted decreases. Year-over-year contract activity slid in all four major regions.This was above expectations of a 2.0% decrease for this index. Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in June and July.
The Pending Home Sales Index (PHSI), a forward-looking indicator of home sales based on contract signings, inched up 0.7% to 99.9 in May. Year-over-year, transactions dropped 13.6%. An index of 100 is equal to the level of contract activity in 2001.
"Despite the small gain in pending sales from the prior month, the housing market is clearly undergoing a transition," said NAR Chief Economist Lawrence Yun. "Contract signings are down sizably from a year ago because of much higher mortgage rates."
...
The Northeast PHSI jumped 15.4% compared to last month to 86.7, down 11.9% from May 2021. The Midwest index retreated 1.7% to 98.6 in May, a decline of 8.8% from a year ago.
The South PHSI increased 0.2% to 119.0 in May, a 13.8% drop from the previous year. The West index contracted 5.0% in May to 81.6, down 19.8% from May 2021.
emphasis added
Five High Frequency Indicators for the Economy
by Calculated Risk on 6/27/2022 08:16:00 AM
These indicators are mostly for travel and entertainment. It is interesting to watch these sectors recover as the pandemic subsides. Notes: I've added back gasoline supplied to see if there is an impact from higher gasoline prices. Apple has discontinued "Apple mobility", and restaurant traffic is mostly back to normal.
The TSA is providing daily travel numbers.
This data is as of June 26th.
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 10.8% from the same day in 2019 (89.2% of 2019). (Dashed line)
Air travel - as a percent of 2019 - has been moving sideways over the last several months, off about 10% from 2019.
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 June 23rd.
Note that the data is usually noisy week-to-week and depends on when blockbusters are released.
Movie ticket sales were at $241 million last week, down about 6% from the median for the week.
Note that the data is usually noisy week-to-week and depends on when blockbusters are released.
Movie ticket sales were at $241 million last week, down about 6% from the median for the week.
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. Dashed purple is 2019 (STR is comparing to a strong year for hotels).
This data is through June 18th. The occupancy rate was down 4.8% compared to the same week in 2019.
The 4-week average of the occupancy rate is slightly above the median rate for the previous 20 years (Blue).
Notes: Y-axis doesn't start at zero to better show the seasonal change.
Notes: Y-axis doesn't start at zero to better show the seasonal change.
NOTE: This is last week's data due to system issues at the EIA.
This graph, based on weekly data from the U.S. Energy Information Administration (EIA), shows gasoline supplied compared to the same week of 2019.
Blue is for 2020. Purple is for 2021, and Red is for 2022.
As of June 10th, gasoline supplied was down 7.9% compared to the same week in 2019.
Recently gasoline supplied has been running somewhat below 2019 levels.
----- New York City Subway Usage -----
Here is some interesting data on New York subway usage (HT BR).
This graph is from Todd W Schneider.
Blue is for 2020. Purple is for 2021, and Red is for 2022.
As of June 10th, gasoline supplied was down 7.9% compared to the same week in 2019.
Recently gasoline supplied has been running somewhat below 2019 levels.
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, June 24th.
He notes: "Data updates weekly from the MTA’s public turnstile data, usually on Saturday mornings".
Sunday, June 26, 2022
Monday: Durable Goods, Pending Home Sales, Dallas Fed Mfg
by Calculated Risk on 6/26/2022 06:56:00 PM
Weekend:
• Schedule for Week of June 26, 2022
Monday:
• At 8:30 AM ET, Durable Goods Orders for May from the Census Bureau. The consensus is for a 0.1% increase in durable goods orders.
• At 10:00 AM, Pending Home Sales Index for May. The consensus is for a 2.0% decrease in the index.
• At 10:30 AM, Dallas Fed Survey of Manufacturing Activity for June.
From CNBC: Pre-Market Data and Bloomberg futures S&P 500 futures are down 12, and DOW futures are down 102 (fair value).
Oil prices were down over the last week with WTI futures at $107.62 per barrel and Brent at $113.12 per barrel. A year ago, WTI was at $73 and Brent was at $76 - so WTI oil prices are up 45% year-over-year.
Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $4.88 per gallon. A year ago prices were at $3.09 per gallon, so gasoline prices are up $1.79 per gallon year-over-year.
Hotels: Occupancy Rate Down 4.8% Compared to Same Week in 2019
by Calculated Risk on 6/26/2022 08:12:00 AM
U.S. hotel revenue per available room (RevPAR) reached an all-time weekly high on a nominal basis and a pandemic-era high on an inflation-adjusted basis, according to STR‘s latest data through June 18.The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.
June 12-18, 2022 (percentage change from comparable week in 2019*):
• Occupancy: 71.8% (-4.8%)
• Average daily rate (ADR): $155.02 (+14.9%)
• evenue per available room (RevPAR): $111.29 (+9.4%)
*Due to the pandemic impact, STR is measuring recovery against comparable time periods from 2019.
emphasis added
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. Dashed purple is 2019 (STR is comparing to a strong year for hotels).
The 4-week average of the occupancy rate is above 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 over the summer.
Saturday, June 25, 2022
Real Estate Newsletter Articles this Week
by Calculated Risk on 6/25/2022 02:11:00 PM
At the Calculated Risk Real Estate Newsletter this week:
• May New Home Sales Increase, Over 5 Months of Inventory Under Construction
• New Home Sales and Cancellations
• Final Look at Local Housing Markets in May
• NAR: Existing-Home Sales Decreased to 5.41 million SAAR in May
• Housing Completions will Increase Sharply in 2022
• 3rd Look at Local Housing Markets in May
This is usually published 4 to 6 times a week and provides more in-depth analysis of the housing market.
You can subscribe at https://calculatedrisk.substack.com/
Most content is available for free (and no Ads), but please subscribe!
Schedule for Week of June 26, 2022
by Calculated Risk on 6/25/2022 08:11:00 AM
The key reports this week are the third estimate of Q1 GDP, and Personal Income and Outlays for May.
Other key reports include the June ISM Manufacturing survey, June Vehicle Sales, and April Case-Shiller house prices.
For manufacturing, the June Richmond and Dallas Fed manufacturing surveys will be released.
8:30 AM: Durable Goods Orders for May from the Census Bureau. The consensus is for a 0.1% increase in durable goods orders.
10:00 AM: Pending Home Sales Index for May. The consensus is for a 2.0% decrease in the index.
10:30 AM: Dallas Fed Survey of Manufacturing Activity for June.
9:00 AM: S&P/Case-Shiller House Price Index for April.This graph shows the year-over-year change in the seasonally adjusted National Index, Composite 10 and Composite 20 indexes through the most recent report (the Composite 20 was started in January 2000).
The consensus is for a 21.0% year-over-year increase in the Comp 20 index for April.
9:00 AM: FHFA House Price Index for April 2021. This was originally a GSE only repeat sales, however there is also an expanded index.
10:00 AM: Richmond Fed Survey of Manufacturing Activity for June.
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
8:30 AM: Gross Domestic Product, 1st quarter 2022 (Third estimate). The consensus is that real GDP decreased 1.5% annualized in Q1, unchanged from the second estimate of a 1.5% decrease.
Early: Census Bureau to Release Vintage 2021 Population Estimates
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for 230 thousand up from 229 thousand last week.
8:30 AM ET: Personal Income and Outlays, May 2022. The consensus is for a 0.5% increase in personal income, and for a 0.5% increase in personal spending. And for the Core PCE price index to increase 0.4%. PCE prices are expected to be up 6.2% YoY, and core PCE prices up 4.7% YoY.
9:45 AM: Chicago Purchasing Managers Index for June.
10:00 AM: ISM Manufacturing Index for June. The consensus is for the ISM to be at 55.0, down from 56.1 in May.
10:00 AM: Construction Spending for May. The consensus is for a 0.4% increase in construction spending.
Late in the day: Light vehicle sales for June.The consensus is for light vehicle sales to be 13.6 million SAAR in June, up from 12.7 million in May (Seasonally Adjusted Annual Rate).
This graph shows light vehicle sales since the BEA started keeping data in 1967. The dashed line is the sales rate for last month.
Wards Auto is forecasting sales of 13.3 million SAAR in June.
Friday, June 24, 2022
COVID June 24, 2022, Update on Cases, Hospitalizations and Deaths
by Calculated Risk on 6/24/2022 09:01:00 PM
On COVID (focus on hospitalizations and deaths):
| COVID Metrics | ||||
|---|---|---|---|---|
| Now | Week Ago | Goal | ||
| Percent fully Vaccinated | 66.9% | --- | ≥70.0%1 | |
| Fully Vaccinated (millions) | 222.1 | --- | ≥2321 | |
| New Cases per Day3 | 97,548 | 102,042 | ≤5,0002 | |
| Hospitalized3🚩 | 24,950 | 24,513 | ≤3,0002 | |
| Deaths per Day3 | 283 | 291 | ≤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.
Average daily deaths bottomed in July 2021 at 214 per day.
