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Sunday, May 23, 2010

Weekly Summary and a Look Ahead

by Calculated Risk on 5/23/2010 12:12:00 PM

Three housing related reports will be released this week: existing home sales on Monday, Case-Shiller house prices on Tuesday, and new home sales on Wednesday.

On Monday, the April Chicago Fed National Activity Index will be released at 8:30 AM. This is a composite index of other data. At 10 AM the National Association for Realtors (NAR) will release the April existing home sales report. The consensus is for an increase to 5.6 million sales in April as a seasonally adjusted annual rate (SAAR). Also on Monday, the DOT will probably release the Vehicle Miles Driven for March. This has been showing declining Year-over-year miles driven.

On Tuesday, the March Case-Shiller house price index will be released at 9:00 AM. The consensus is for a slight decline in the house price index. At 10:00 AM, the Conference Board will release Consumer Confidence for May (consensus is for an increase to 59). Also on Tuesday, the FHFA house price index, and the Richmond Fed survey will be released.

On Wednesday, the April Durable Goods Orders will be released at 8:30 AM. The consensus is for a 1.5% increase. At 10 AM, the Census Bureau will release the April New Home sales report. The consensus is for an increase to 425K (SAAR) from 411K in March. Since new home sales are reported when a contract is signed, April was the last month that reported sales will be positively impacted by the tax credit.

On Thursday, the first revision of the Q1 GDP report will be released at 8:30 AM. The consensus is for an upward revision to 3.5% from the initially reported 3.2%. Also on Thursday, the closely watched initial weekly unemployment claims will be released. Consensus is for a decline to 450K from 471K last week.

And on Friday, the BEA will release the Personal Income and Outlayreport for April at 8:30 AM. Also on Friday the Chicago Purchasing Managers Index for May will be released. And of course the FDIC will probably have another busy Friday afternoon ...

There will be several Fed speeches this week, and a few other economic releases (trucking index, restaurant index).

And a summary of last week:

  • MBA Q1 2010: Record 14.69% of Mortgage Loans Delinquent or in Foreclosure

    The MBA reported a record 14.69 percent of mortgage loans were either one payment delinquent or in the foreclosure process in Q1 2010 (seasonally adjusted).

    MBA Delinquency by Period Click on graph for larger image in new window.

    This graph shows the percent loans delinquent by duration. Loans 30 days delinquent increased to 3.45%, about the same level as in Q4 2008.

    Delinquent loans in the 60 day bucket increased too, and are also close to the Q4 2008 level. This suggests that the pipeline is still filling up at a high rate, but slightly below the rates of early 2009.

    The 90+ day and 'in foreclosure' rates are at record levels. Obviously the lenders have been slow to start foreclosure proceedings - and the 90+ day delinquent bucket is very full. Also lenders have been slow to actually foreclose - and the 'in foreclosure' bucket is at record levels.

    MBA Delinquency rate by State
    The second graph shows the delinquency rate by state (red is seriously delinquent: 90+ days or in foreclosure, blue is delinquent less than 90 days).

    Thirty four states and the District of Columbia have total delinquency rates over 10%. This is a widespread problem.

  • Housing Starts increase in April

    Total Housing Starts and Single Family Housing StartsTotal housing starts were at 672 thousand (SAAR) in April, up 5.8% from the revised March rate, and up 41% from the all time record low in April 2009 of 477 thousand (the lowest level since the Census Bureau began tracking housing starts in 1959).

    Single-family starts were at 593 thousand (SAAR) in April, up 10.2% from the revised February rate, and 65% above the record low in January 2009 (360 thousand).

    Permits declined sharply suggesting that starts will decline next month.

  • NAHB Builder Confidence Increases in May

    Residential NAHB Housing Market Index This graph shows the builder confidence index from the National Association of Home Builders (NAHB).

    The housing market index (HMI) was at 22 in May. This is an increase from 19 in April. This is the highest level since August 2007 - and builders were seen as depressed then!

    The record low was 8 set in January 2009. This is still very low ... Note: any number under 50 indicates that more builders view sales conditions as poor than good.

  • First American CoreLogic: House Prices Decline 0.3% in March

    Loan Performance House Price IndexOn a month-over-month basis, the national average home price index fell by 0.3 percent in March 2010 compared to February 2010.

    This graph shows the national LoanPerformance data since 1976. January 2000 = 100.

    The index is up 1.7% over the last year, and off 30.5% from the peak.

  • Moody's: CRE Prices Decline 0.5% in March

    CRE and Residential Price indexes Moody's reported that the Moody’s/REAL All Property Type Aggregate Index declined 0.5% in March. This is a repeat sales measure of commercial real estate prices.

    This is a comparison of the Moodys/REAL Commercial Property Price Index (CPPI) and the Case-Shiller composite 20 index. CRE prices only go back to December 2000.

    Commercial real estate values are now down 25% over the last year, and down 42% from the peak in August 2007.

  • AIA: Architecture Billings Index shows less Contraction in April

    AIA Architecture Billing Index The American Institute of Architects’ Architecture Billings Index increased to 48.5 in April from 46.1 in March. This index is a leading indicator for Commercial Real Estate (CRE) investment. Any reading below 50 indicates contraction.

    According to the AIA, there is an "approximate nine to twelve month lag time between architecture billings and construction spending" on non-residential construction. So there will probably be further declines in CRE investment through all of 2010, and probably into 2011.

  • Other Economic Stories ...

  • Financial Reform passes in Senate: From the NY Times: Bill Passed in Senate Broadly Expands Oversight of Wall St.

  • From Bloomberg: German Lawmakers Approve Share of $1 Trillion Bailout

  • From the NY Fed: Empire State Manufacturing Survey. Manufacturing Conditions Improve, but at Slower Pace

  • From the Philadelphia: Business Outlook Survey.. Philly Fed Index increases slightly in May, New orders index declines

  • From Treasury: HAMP Servicer Performance Report Through April 2010. HAMP April data shows program slowing down

  • From Cleveland Fed President Sandra Pianalto: Forecasting in Uncertain Times. "Subdued" Recovery, Unemployment Rate to decline "Gradually"

  • April State Unemployment Rates: California and Nevada at series highs

  • From Freddie Mac: Long- and Short-Term Mortgage Rates Fall Again This Week. Near record low mortgage rates.

  • Unofficial Problem Bank list hits 737

    Best wishes to all.