RSS Feed by Calculated Risk on 2/20/2023 01:37:00 PM
Monday, February 20, 2023
Fannie "Real Estate Owned" inventory increased in Q4; Expected to increase further in 2023
Fannie reported results for Q4 2022. Here is some information on single-family Real Estate Owned (REOs).
First, a note on the pandemic from Fannie:
"In response to the COVID-19 pandemic, a number of legislative and executive actions were taken by the federal government and state and local governments to assist affected borrowers and renters and to slow the spread of the pandemic, including actions that applied to the loans we guarantee. While most of these actions are no longer in effect, the COVID-19 national emergency remains in place. In January 2023, the Administration announced it intends to extend the COVID-19 national emergency to May 11, 2023, and end the emergency on that date. We continue to offer forbearance relief and other home retention solutions to borrowers affected by the COVID-19 pandemic ..."
emphasis added
One of those actions was a foreclosure moratorium that ended in mid-2021. Since then, foreclosures have increased slightly.
Fannie Mae reported the number of REOs increased to 8,779 at the end of Q4 2022, up 23% from 7,166 at the end of Q4 2021. For Fannie, this is down 95% from the 166,787 peak number of REOs in Q3 2010.
Click on graph for larger image.
Here is a graph of Fannie Real Estate Owned (REO).
This is well below a normal level of REOs for Fannie, and REO levels will increase further in 2023, but there will not be a huge wave of foreclosures.
Click on graph for larger image.Here is a graph of Fannie Real Estate Owned (REO).
This is well below a normal level of REOs for Fannie, and REO levels will increase further in 2023, but there will not be a huge wave of foreclosures.
First time ever more "Built-for-Rent" Units started Quarterly than "Built-for-Sale"
by Calculated Risk on 2/20/2023 10:37:00 AM
Today, in the Calculated Risk Real Estate Newsletter: First time ever more "Built-for-Rent" Units started Quarterly than "Built-for-Sale"
A brief excerpt:
Along with the monthly housing starts report for January last week, the Census Bureau released Housing Units Started by Purpose and Design through Q4 2022.There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/
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 multi-family built for sale.Single family starts built for sale (red) were down 34% in Q4 2022 compared to Q4 2021. And owner built starts (orange) were down 10% year-over-year.
Multi-family built for sale decreased and are still low.The 'units built for rent' (blue) and were up 15% in Q4 2022 compared to Q4 2021. For the first time since this series started in 1974, there were more units built-for-rent started in Q4 2022 than single family units built-for-sale started.
Housing February 20th Weekly Update: Inventory Decreased 1.5% Week-over-week
by Calculated Risk on 2/20/2023 08:32:00 AM
Altos reports that active single-family inventory was down 1.5% week-over-week. Usually inventory bottoms in early February, so we'd expect inventory to bottom seasonally soon.
Here are the same week inventory changes for the last five years:
2023: -6.9K
2022: -1.8K
2021: -10.5K
2020: +4.6K
2019: +6.7K
Click on graph for larger image.This inventory graph is courtesy of Altos Research.
As of February 17th, inventory was at 437 thousand (7-day average), compared to 443 thousand the prior week.
The red line is for 2023. The black line is for 2019. Note that inventory is up from the previous two years (the record low was in 2022), but still well below normal levels.
Inventory was up 76.4% compared to the same week in 2022 (last week it was up 78.0%), and down 46.7% compared to the same week in 2019 (last week down 45.4%).
A key will be when inventory starts increasing in 2023 - so far inventory has declined about 11.1% over the first seven weeks of 2023.
Mike Simonsen discusses this data regularly on Youtube.
Sunday, February 19, 2023
LA Port Inbound Traffic Down 22% YoY in January
by Calculated Risk on 2/19/2023 08:30:00 PM
Notes: The expansion to the Panama Canal was completed in 2016 (As I noted several years ago), and some of the traffic that used the ports of Los Angeles and Long Beach is probably going through the canal. This might be impacting TEUs on the West Coast.
Container traffic gives us an idea about the volume of goods being exported and imported - and usually some hints about the trade report since LA area ports handle about 40% of the nation's container port traffic.
The following graphs are for inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container).
To remove the strong seasonal component for inbound traffic, the first graph shows the rolling 12-month average.
Click on graph for larger image.
On a rolling 12-month basis, inbound traffic decreased 1.9% in January compared to the rolling 12 months ending in December. Outbound traffic decreased 0.6% compared to the rolling 12 months ending the previous month.
The 2nd graph is the monthly data (with a strong seasonal pattern for imports).
Usually imports peak in the July to October period as retailers import goods for the Christmas holiday, and then decline sharply and bottom in February or March depending on the timing of the Chinese New Year.
Usually imports peak in the July to October period as retailers import goods for the Christmas holiday, and then decline sharply and bottom in February or March depending on the timing of the Chinese New Year.Imports were down 22% YoY in January, and exports were down 7% YoY.
It is possible that exports have bottomed after declining for several years (even prior to the pandemic).
Existing Home Sales: Lawler vs. the Consensus
by Calculated Risk on 2/19/2023 12:14:00 PM
Housing economist Tom Lawler has been sending me his predictions of what the NAR will report for almost 13 years. He has graciously allowed me to share his predictions with the readers of this blog.
The table below shows the consensus for each month, Lawler's predictions, and the NAR's initially reported level of sales. Lawler hasn't always been closer than the consensus, but usually when there has been a fairly large spread between Lawler's estimate and the "consensus", Lawler has been closer.
The NAR is scheduled to release Existing Home Sales for January on Tuesday at 10:00 AM, February 21st. The consensus is for 4.10 million SAAR in January. Tom Lawler estimates the NAR will report sales of 4.18 million SAAR.
Take the OVER this month!
Over the last 12+ years, the consensus average miss was 144 thousand (median 110 thousand), and Lawler's average miss was 72 thousand (median 60 thousand).
Over the last 12+ years, the consensus average miss was 144 thousand (median 110 thousand), and Lawler's average miss was 72 thousand (median 60 thousand).
Note on Median Prices: Lawler has also been very close on median prices, and he expects the NAR to report prices up "about 2.4% from last January".
| Existing Home Sales, Forecasts and NAR Report millions, seasonally adjusted annual rate basis (SAAR) | |||
|---|---|---|---|
| Month | Consensus | Lawler | NAR reported1 |
| May-10 | 6.20 | 5.83 | 5.66 |
| Jun-10 | 5.30 | 5.30 | 5.37 |
| Jul-10 | 4.66 | 3.95 | 3.83 |
| Aug-10 | 4.10 | 4.10 | 4.13 |
| Sep-10 | 4.30 | 4.50 | 4.53 |
| Oct-10 | 4.50 | 4.46 | 4.43 |
| Nov-10 | 4.85 | 4.61 | 4.68 |
| Dec-10 | 4.90 | 5.13 | 5.28 |
| Jan-11 | 5.20 | 5.17 | 5.36 |
| Feb-11 | 5.15 | 5.00 | 4.88 |
| Mar-11 | 5.00 | 5.08 | 5.10 |
| Apr-11 | 5.20 | 5.15 | 5.05 |
| May-11 | 4.75 | 4.80 | 4.81 |
| Jun-11 | 4.90 | 4.71 | 4.77 |
| Jul-11 | 4.92 | 4.69 | 4.67 |
| Aug-11 | 4.75 | 4.92 | 5.03 |
| Sep-11 | 4.93 | 4.83 | 4.91 |
| Oct-11 | 4.80 | 4.86 | 4.97 |
| Nov-11 | 5.08 | 4.40 | 4.42 |
| Dec-11 | 4.60 | 4.64 | 4.61 |
| Jan-12 | 4.69 | 4.66 | 4.57 |
| Feb-12 | 4.61 | 4.63 | 4.59 |
| Mar-12 | 4.62 | 4.59 | 4.48 |
| Apr-12 | 4.66 | 4.53 | 4.62 |
| May-12 | 4.57 | 4.66 | 4.55 |
| Jun-12 | 4.65 | 4.56 | 4.37 |
| Jul-12 | 4.50 | 4.47 | 4.47 |
| Aug-12 | 4.55 | 4.87 | 4.82 |
| Sep-12 | 4.75 | 4.70 | 4.75 |
| Oct-12 | 4.74 | 4.84 | 4.79 |
| Nov-12 | 4.90 | 5.10 | 5.04 |
| Dec-12 | 5.10 | 4.97 | 4.94 |
| Jan-13 | 4.90 | 4.94 | 4.92 |
| Feb-13 | 5.01 | 4.87 | 4.98 |
| Mar-13 | 5.03 | 4.89 | 4.92 |
| Apr-13 | 4.92 | 5.03 | 4.97 |
| May-13 | 5.00 | 5.20 | 5.18 |
| Jun-13 | 5.27 | 4.99 | 5.08 |
| Jul-13 | 5.13 | 5.33 | 5.39 |
| Aug-13 | 5.25 | 5.35 | 5.48 |
| Sep-13 | 5.30 | 5.26 | 5.29 |
| Oct-13 | 5.13 | 5.08 | 5.12 |
| Nov-13 | 5.02 | 4.98 | 4.90 |
| Dec-13 | 4.90 | 4.96 | 4.87 |
| Jan-14 | 4.70 | 4.67 | 4.62 |
| Feb-14 | 4.64 | 4.60 | 4.60 |
| Mar-14 | 4.56 | 4.64 | 4.59 |
| Apr-14 | 4.67 | 4.70 | 4.65 |
| May-14 | 4.75 | 4.81 | 4.89 |
| Jun-14 | 4.99 | 4.96 | 5.04 |
| Jul-14 | 5.00 | 5.09 | 5.15 |
| Aug-14 | 5.18 | 5.12 | 5.05 |
| Sep-14 | 5.09 | 5.14 | 5.17 |
| Oct-14 | 5.15 | 5.28 | 5.26 |
| Nov-14 | 5.20 | 4.90 | 4.93 |
| Dec-14 | 5.05 | 5.15 | 5.04 |
| Jan-15 | 5.00 | 4.90 | 4.82 |
| Feb-15 | 4.94 | 4.87 | 4.88 |
| Mar-15 | 5.04 | 5.18 | 5.19 |
| Apr-15 | 5.22 | 5.20 | 5.04 |
| May-15 | 5.25 | 5.29 | 5.35 |
| Jun-15 | 5.40 | 5.45 | 5.49 |
| Jul-15 | 5.41 | 5.64 | 5.59 |
| Aug-15 | 5.50 | 5.54 | 5.31 |
| Sep-15 | 5.35 | 5.56 | 5.55 |
| Oct-15 | 5.41 | 5.33 | 5.36 |
| Nov-15 | 5.32 | 4.97 | 4.76 |
| Dec-15 | 5.19 | 5.36 | 5.46 |
| Jan-16 | 5.32 | 5.36 | 5.47 |
| Feb-16 | 5.30 | 5.20 | 5.08 |
| Mar-16 | 5.27 | 5.27 | 5.33 |
| Apr-16 | 5.40 | 5.44 | 5.45 |
| May-16 | 5.64 | 5.55 | 5.53 |
| Jun-16 | 5.48 | 5.62 | 5.57 |
| Jul-16 | 5.52 | 5.41 | 5.39 |
| Aug-16 | 5.44 | 5.49 | 5.33 |
| Sep-16 | 5.35 | 5.55 | 5.47 |
| Oct-16 | 5.44 | 5.47 | 5.60 |
| Nov-16 | 5.54 | 5.60 | 5.61 |
| Dec-16 | 5.54 | 5.55 | 5.49 |
| Jan-17 | 5.55 | 5.60 | 5.69 |
| Feb-17 | 5.55 | 5.41 | 5.48 |
| Mar-17 | 5.61 | 5.74 | 5.71 |
| Apr-17 | 5.67 | 5.56 | 5.57 |
| May-17 | 5.55 | 5.65 | 5.62 |
| Jun-17 | 5.58 | 5.59 | 5.52 |
| Jul-17 | 5.57 | 5.38 | 5.44 |
| Aug-17 | 5.48 | 5.39 | 5.35 |
| Sep-17 | 5.30 | 5.38 | 5.39 |
| Oct-17 | 5.30 | 5.60 | 5.48 |
| Nov-17 | 5.52 | 5.77 | 5.81 |
| Dec-17 | 5.75 | 5.66 | 5.57 |
| Jan-18 | 5.65 | 5.48 | 5.38 |
| Feb-18 | 5.42 | 5.44 | 5.54 |
| Mar-18 | 5.28 | 5.51 | 5.60 |
| Apr-18 | 5.60 | 5.48 | 5.46 |
| May-18 | 5.56 | 5.47 | 5.43 |
| Jun-18 | 5.45 | 5.35 | 5.38 |
| Jul-18 | 5.43 | 5.40 | 5.34 |
| Aug-18 | 5.36 | 5.36 | 5.34 |
| Sep-18 | 5.30 | 5.20 | 5.15 |
| Oct-18 | 5.20 | 5.31 | 5.22 |
| Nov-18 | 5.19 | 5.23 | 5.32 |
| Dec-18 | 5.24 | 4.97 | 4.99 |
| Jan-19 | 5.05 | 4.92 | 4.94 |
| Feb-19 | 5.08 | 5.46 | 5.51 |
| Mar-19 | 5.30 | 5.40 | 5.21 |
| Apr-19 | 5.36 | 5.31 | 5.19 |
| May-19 | 5.29 | 5.40 | 5.34 |
| Jun-19 | 5.34 | 5.25 | 5.27 |
| Jul-19 | 5.39 | 5.40 | 5.42 |
| Aug-19 | 5.38 | 5.42 | 5.49 |
| Sep-19 | 5.45 | 5.36 | 5.38 |
| Oct-19 | 5.49 | 5.36 | 5.46 |
| Nov-19 | 5.45 | 5.43 | 5.35 |
| Dec-19 | 5.43 | 5.40 | 5.54 |
| Jan-20 | 5.45 | 5.42 | 5.46 |
| Feb-20 | 5.50 | 5.58 | 5.77 |
| Mar-20 | 5.30 | 5.25 | 5.27 |
| Apr-20 | 4.30 | 4.17 | 4.33 |
| May-20 | 4.38 | 3.80 | 3.91 |
| Jun-20 | 4.86 | 4.65 | 4.72 |
| Jul-20 | 5.39 | 5.85 | 5.86 |
| Aug-20 | 6.00 | 5.92 | 6.00 |
| Sep-20 | 6.25 | 6.38 | 6.54 |
| Oct-20 | 6.45 | 6.63 | 6.85 |
| Nov-20 | 6.70 | 6.50 | 6.69 |
| Dec-20 | 6.55 | 6.62 | 6.76 |
| Jan-21 | 6.60 | 6.48 | 6.69 |
| Feb-21 | 6.51 | 6.29 | 6.22 |
| Mar-21 | 6.17 | 6.02 | 6.01 |
| Apr-21 | 6.09 | 5.96 | 5.85 |
| May-21 | 5.74 | 5.78 | 5.80 |
| Jun-21 | 5.90 | 5.79 | 5.86 |
| Jul-21 | 5.84 | 5.86 | 5.99 |
| Aug-21 | 5.88 | 5.90 | 5.88 |
| Sep-21 | 6.06 | 6.20 | 6.29 |
| Oct-21 | 6.20 | 6.34 | 6.34 |
| Nov-21 | 6.20 | 6.45 | 6.46 |
| Dec-21 | 6.45 | 6.33 | 6.18 |
| Jan-22 | 6.12 | 6.36 | 6.50 |
| Feb-22 | 6.16 | 5.97 | 6.02 |
| Mar-22 | 5.80 | 5.74 | 5.77 |
| Apr-22 | 5.62 | 5.57 | 5.61 |
| May-22 | 5.41 | 5.35 | 5.41 |
| Jun-22 | 5.40 | 5.12 | 5.12 |
| Jul-22 | 4.88 | 4.90 | 4.81 |
| Aug-22 | 4.70 | 4.84 | 4.80 |
| Sep-22 | 4.69 | 4.82 | 4.71 |
| Oct-22 | 4.39 | 4.49 | 4.43 |
| Nov-22 | 4.20 | 4.16 | 4.09 |
| Dec-22 | 3.95 | 3.96 | 4.02 |
| Jan-22 | 4.10 | 4.18 | NA |
| 1NAR initially reported before revisions. | |||
Saturday, February 18, 2023
Real Estate Newsletter Articles this Week: "Near Record Number of Housing Units Under Construction"
by Calculated Risk on 2/18/2023 02:11:00 PM
At the Calculated Risk Real Estate Newsletter this week:
• 3rd Look at Local Housing Markets in January Lawler: Early Read on Existing Home Sales in January
• January Housing Starts: Near Record Number of Housing Units Under Construction
• Current State of the Housing Market: Overview for mid-February
• Update: Some "Good News" for Homebuilders
• 2nd Look at Local Housing Markets in January
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 February 19, 2023
by Calculated Risk on 2/18/2023 08:11:00 AM
The key reports this week are January New and Existing Home sales, the second estimate of Q4 GDP and Personal Income and Outlays for January.
All US markets will be closed in observance of the Presidents' Day holiday.
10:00 AM: Existing Home Sales for January from the National Association of Realtors (NAR). The consensus is for 4.10 million SAAR, up from 4.02 million.The graph shows existing home sales from 1994 through the report last month.
Housing economist Tom Lawler expects the NAR to report sales of 4.18 million SAAR for January.
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).
2:00 PM: FOMC Minutes, Meeting of January 31-February 1, 2023
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for 200 thousand initial claims, up from 194 thousand last week.
8:30 AM: Gross Domestic Product, 4th quarter 2022 (Second estimate). The consensus is that real GDP increased 2.9% annualized in Q4, unchanged from the advance estimate of 2.9%.
8:30 AM ET: Chicago Fed National Activity Index for January. This is a composite index of other data.
11:00 AM: the Kansas City Fed manufacturing survey for February.
8:30 AM ET: Personal Income and Outlays for January. The consensus is for a 0.9% increase in personal income, and for a 1.3% increase in personal spending. And for the Core PCE price index to increase 0.4%. PCE prices are expected to be up 4.9% YoY, and core PCE prices up 4.3% YoY.
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 increased to 620 thousand SAAR, down from 616 thousand in December.
10:00 AM: University of Michigan's Consumer sentiment index (Final for February). The consensus is for a reading of 66.4.
10:00 AM: University of Michigan's Consumer sentiment index (Final for February). The consensus is for a reading of 66.4.
Friday, February 17, 2023
COVID Feb 17, 2023: Update on Cases, Hospitalizations and Deaths
by Calculated Risk on 2/17/2023 09:00:00 PM
Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.
On COVID (focus on hospitalizations and deaths). Data is now weekly.
| COVID Metrics | ||||
|---|---|---|---|---|
| Now | Week Ago | Goal | ||
| New Cases per Week2 | 259,339 | 282,901 | ≤35,0001 | |
| Hospitalized2 | 22,059 | 23,937 | ≤3,0001 | |
| Deaths per Week2 | 2,838 | 3,166 | ≤3501 | |
| 1my goals to stop weekly posts, 2Weekly for Cases, Currently Hospitalized, and Deaths 🚩 Increasing number weekly for Cases, Hospitalized, and Deaths ✅ Goal met. | ||||
Click on graph for larger image.This graph shows the weekly (columns) number of deaths reported.
The pandemic low was the week of July 7, 2021, at 1,690 deaths.
3rd Look at Local Housing Markets in January; Lawler: Early Read on Existing Home Sales in January
by Calculated Risk on 2/17/2023 03:20:00 PM
Today, in the Calculated Risk Real Estate Newsletter: 3rd Look at Local Housing Markets in January
A brief excerpt:
From housing economist Tom Lawler:There is much more in the article. You can subscribe at https://calculatedrisk.substack.com/Based on publicly-available local realtor/MLS reports released across the country through today, I project that existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 4.18 million in January, up 4.0% from December’s preliminary pace and down 35.6% from last January’s seasonally adjusted pace....In January, sales were down 33.9% in these markets. In December, these same markets were down 37.5% YoY Not Seasonally Adjusted (NSA).
This is a smaller YoY decline than in December for these markets. This data suggests NAR reported sales will rebound in January from 4.02 million SAAR in December.
This will still be a significant YoY decline, and the 17th consecutive month with a YoY decline.
Realtor.com Reports Weekly Active Inventory Up 70% YoY; New Listings Down 13% YoY
by Calculated Risk on 2/17/2023 12:42:00 PM
Realtor.com has monthly and weekly data on the existing home market. Here is their weekly report released today from Chief Economist Danielle Hale: Weekly Housing Trends View — Data Week Ending Feb 11, 2023
• Active inventory growth continued to climb with for-sale homes up 70% above one year ago. Inventories of for-sale homes rose again, on par with the yearly gains we saw last week. Still-low buyer interest amid high costs rather than an influx of sellers is driving this increase. Even after these huge gains, January data show that nationwide there are still more than 40% fewer homes for sale than were available pre-pandemic,
...
• New listings–a measure of sellers putting homes up for sale–were again down, this week by 13% from one year ago. For 32 weeks now, fewer homeowners put their homes on the market for sale than at this time last year. After smaller declines in the first few weeks of the year, the gap has widened for a third week, indicating lower seller interest than we saw one year ago.
Here is a graph of the year-over-year change in inventory according to realtor.com. In early 2022, inventory was declining rapidly, so the year-over-year change is up sharply.
