by Calculated Risk on 7/09/2024 07:33:00 PM
Tuesday, July 09, 2024
Wednesday: Fed Chair Powell
Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.
Wednesday:
• At 7:00 AM ET, The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.
• At 10:00 AM, Testimony, Fed Chair Jerome Powell, Semiannual Monetary Policy Report to Congress, Before the U.S. House Financial Services Committee
Wholesale Used Car Prices Declined in June; Down 8.9% Year-over-year
by Calculated Risk on 7/09/2024 02:22:00 PM
From Manheim Consulting today: Wholesale Used-Vehicle Prices Declined in June
Wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) were down in June compared to May. The Manheim Used Vehicle Value Index (MUVVI) fell to 196.1, a decline of 8.9% from a year ago. The seasonal adjustment to the index mitigated the impact on the month, resulting in values that declined 0.6% month over month for the second time in a row. The non-adjusted price in June decreased by 2.2% compared to May, moving the unadjusted average price down 10.0% year over year.Click on graph for larger image.
emphasis added
This index from Manheim Consulting is based on all completed sales transactions at Manheim’s U.S. auctions.
1st Look at Local Housing Markets in June
by Calculated Risk on 7/09/2024 11:19:00 AM
Today, in the Calculated Risk Real Estate Newsletter: 1st Look at Local Housing Markets in June
A brief excerpt:
NOTE: The tables for active listings, new listings and closed sales all include a comparison to June 2019 for each local market (some 2019 data is not available).There is much more in the article.
This is the first look at several early reporting local markets in June. I’m tracking over 40 local housing markets in the US. Some of the 40 markets are states, and some are metropolitan areas. I’ll update these tables throughout the month as additional data is released.
Closed sales in June were mostly for contracts signed in April and May when 30-year mortgage rates averaged 6.99% and 7.06%, respectively (Freddie Mac PMMS). May was the first month since last Fall with average 30-year mortgage rates over 7%
...
In June, sales in these markets were down 6.7% YoY. Last month, in May, these same markets were up 3.1% year-over-year Not Seasonally Adjusted (NSA).
Sales in all of these markets are down significantly compared to June 2019.
...
This is a year-over-year decrease NSA for these early reporting markets. However, there were two fewer working days in June 2024 compared to June 2023 (19 vs 21), so seasonally adjusted sales will be much higher than the NSA data suggests.
...
This was just a several early reporting markets. Many more local markets to come!
Fed Chair Powell: Semiannual Monetary Policy Report to the Congress
by Calculated Risk on 7/09/2024 10:03:00 AM
This testimony will be live here at 10:00 AM ET.
Report here.
From Fed Chair Powell: Testimony: Semiannual Monetary Policy Report to the Congress. An excerpt:
The Federal Reserve remains squarely focused on our dual mandate to promote maximum employment and stable prices for the benefit of the American people. Over the past two years, the economy has made considerable progress toward the Federal Reserve's 2 percent inflation goal, and labor market conditions have cooled while remaining strong. Reflecting these developments, the risks to achieving our employment and inflation goals are coming into better balance.
The Committee has stated that we do not expect it will be appropriate to reduce the target range for the federal funds rate until we have gained greater confidence that inflation is moving sustainably toward 2 percent. Incoming data for the first quarter of this year did not support such greater confidence. The most recent inflation readings, however, have shown some modest further progress, and more good data would strengthen our confidence that inflation is moving sustainably toward 2 percent. emphasis added
Lance Lambert Interviews Me on the Housing Market
by Calculated Risk on 7/09/2024 08:09:00 AM
I'm not sure about "renowned" but this interview hits several of the key points I've been discussing about housing.
From Lance Lambert at ResiClub: Renowned housing analyst who predicted the 2008 home price crash weighs in on the current market Here is the intro:
Years before the housing bubble burst in 2008, housing analyst Bill McBride began chronicling the troubles in the U.S. housing market in his blog Calculated Risk.Enjoy!
Not only did he predict the crash, but he also called the 2012 housing price bottom. Fast-forward to 2024, and this cycle he hasn’t been as concerned as he was in 2007.
McBride has maintained for the past few years that this housing cycle will ultimately resemble something closer to the 1978 to 1982 period—a time of overheated house price growth that saw spiked interest rates, strained affordability, crashed existing home sales volume, and yet no national home price crash—rather than the 2007-2011 national housing price crash years.
To better understand Bill McBride's perspective on the current housing and economic cycle, ResiClub reached out and conducted a Q&A with him.
Monday, July 08, 2024
Tuesday: Fed Chair Powell Testimony
by Calculated Risk on 7/08/2024 07:26:00 PM
From Matthew Graham at Mortgage News Daily: Mortgage Rates Gently Lower to Begin New Week
CPI has been the most important input for rates as far as economic reports are concerned. Thursday's is an exciting installment as it has a chance to confirm a promising shift seen in last month's data. If confirmed, rates should move easily into the 6's. [30 year fixed 7.01%]Tuesday:
emphasis added
• At 6:00 AM ET, NFIB Small Business Optimism Index for June.
• At 10:00 AM, Testimony, Fed Chair Jerome Powell, Semiannual Monetary Policy Report to Congress, Before the U.S. Senate Committee on Banking, Housing, and Urban Affairs
Fannie and Freddie: Single Family Serious Delinquency Rate Decreased in May, Multi-family Increased Slightly
by Calculated Risk on 7/08/2024 12:16:00 PM
Today, in the Calculated Risk Real Estate Newsletter: Fannie and Freddie: Single Family Serious Delinquency Rate Decreased in May, Multi-family Increased Slightly
Brief excerpt:
Single-family serious delinquencies decreased in May, and multi-family serious delinquencies increased slightly.
...
Freddie Mac reports that the multi-family delinquencies rate increased to 0.36% in May, up from 0.35% in April, but down from the recent peak of 0.44% in January.
This graph shows the Freddie multi-family serious delinquency rate since 2012. Rates were still high in 2012 following the housing bust and financial crisis.
The multi-family rate increased following the pandemic and has increased recently as rent growth has slowed, vacancy rates have increased, and borrowing rates have increased sharply. The rate surged higher in January but declined in February and March. This will be something to watch as more apartments come on the market.
Update: Lumber Prices Down 20% YoY
by Calculated Risk on 7/08/2024 10:12:00 AM
SPECIAL NOTE: The CME group discontinued the Random Length Lumber Futures contract on May 16, 2023. I switched to a physically-delivered Lumber Futures contract that was started in August 2022.
This graph shows CME random length framing futures through last August (blue), and the new physically-delivered Lumber Futures (LBR) contract starting in August 2022 (Red).
We didn't see a significant runup in the Spring period of 2023 or 2024 due to the housing slowdown. LBR is now at the lowest level since the futures contract was started.
Housing July 8th Weekly Update: Inventory up 1.1% Week-over-week, Up 40.0% Year-over-year
by Calculated Risk on 7/08/2024 08:13:00 AM
Click on graph for larger image.
This inventory graph is courtesy of Altos Research.
Sunday, July 07, 2024
Sunday Night Futures
by Calculated Risk on 7/07/2024 06:46:00 PM
Weekend:
• Schedule for Week of July 7, 2024
Monday:
• No major economic releases scheduled.
From CNBC: Pre-Market Data and Bloomberg futures S&P 500 are down 9 and DOW futures are down 59 (fair value).
Oil prices were higher over the last week with WTI futures at $83.16 per barrel and Brent at $86.54 per barrel. A year ago, WTI was at $74, and Brent was at $79 - so WTI oil prices are up about 12% year-over-year.
Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $3.47 per gallon. A year ago, prices were at $3.51 per gallon, so gasoline prices are down $0.04 year-over-year.