by Calculated Risk on 5/06/2020 05:13:00 PM

An excellent article by Derek Thompson, on test and trace in South Korea, in The Atlantic: What’s Behind South Korea’s COVID-19 Exceptionalism?

The US might be able to test 400,000 to 600,000 people per day sometime in May according to Dr. Fauci - and that would probably be sufficient for test and trace.

There were 215,433 test results reported over the last 24 hours (the number of tests yesterday were revised up).

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 10.3% (red line). The US probably needs enough tests to push  the percentage positive below 5%. (probably much lower based on testing in New Zealand).

by Calculated Risk on 5/06/2020 12:13:00 PM

This will be interesting to track. The most recent release is for February 2020. The data for March will be released mid-month.

The Department of Transportation (DOT) reported:

Travel on all roads and streets changed by 2.2% (4.9 billion vehicle miles) for February 2020 as compared with February 2019. Travel for the month is estimated to be 231.7 billion vehicle miles.

The seasonally adjusted vehicle miles traveled for February 2020 is 274.3 billion miles, a 2.3% (6.1 billion vehicle miles) increase over February 2019. It also represents -0.2% decline (-0.4 billion vehicle miles) compared with January 2020.

Cumulative Travel for 2020 changed by 2.1% (10.1 billion vehicle miles). The cumulative estimate for the year is 485.3 billion vehicle miles of travel.

The following graph shows the rolling 12 month total vehicle miles driven to remove the seasonal factors.

Click on graph for larger image.

Miles driven declined during the great recession, and the rolling 12 months stayed below the previous peak for a record 85 months.

Miles driven will decline sharply in March, and will really collapse in April. This will be an interesting measure to watch when the economy eventually starts to recover.

by Calculated Risk on 5/06/2020 11:07:00 AM

Note: Las Vegas saw a significant decline in visitor and convention traffic due to COVID-19 in the 2nd half of March. This report is for closed sales in April; sales are counted at the close of escrow, so the contracts for these homes were mostly signed in February and March. There will be further impacts from COVID-19 in future months.

The Las Vegas Realtors reported Southern Nevada housing market feeling effects of coronavirus crisis, LVR housing statistics for April 2020

The total number of existing local homes, condos and townhomes sold during April was 2,411. Compared to the same time last year, April sales were down 31.4% for homes and down 41.6% for condos and townhomes.
...
By the end of April, LVR reported 6,043 single-family homes listed for sale without any sort of offer. That’s down 18.7% from one year ago. For condos and townhomes, the 1,772 properties listed without offers in April represented a 3.0% drop from one year ago.
…
Despite the coronavirus crisis, the number of so-called distressed sales in April remained near historically low levels. The association reported that short sales and foreclosures combined accounted for 1.5% of all existing local property sales in April. That compares to 3.0% of all sales one year ago, 2.5% two years ago, and 8.4% three years ago.
emphasis added

1) Overall sales were down 33.5% year-over-year to 2,411 in April 2020 from 3,625 in April 2019.

2) Active inventory (single-family and condos) is down from a year ago, from a total of 9,261 in April 2019 to 7,815 in April 2020. Note: Total inventory was down 15.6% year-over-year.   And months of inventory is still low.

3) Low level of distressed sales.

by Calculated Risk on 5/06/2020 08:21:00 AM

From ADP:

ADP National Employment Report: Private Sector Employment Decreased by 20,236,000 Jobs in April; the April NER Utilizes Data Through April 12 and Does Not Reflect the Full Impact of COVID-19 on the Overall Employment Situation

Private sector employment decreased by 20,236,000 jobs from March to April according to the April ADP National Employment Report®. ... The report utilizes data through the 12th of the month. The NER uses the same time period the Bureau of Labor and Statistics uses for their survey. As such, the April NER does not reflect the full impact of COVID-19 on the overall employment situation
...
“Job losses of this scale are unprecedented. The total number of job losses for the month of April alone was more than double the total jobs lost during the Great Recession,” said Ahu Yildirmaz, co-head of the ADP Research Institute. “Additionally, it is important to note that the report is based on the total number of payroll records for employees who were active on a company’s payroll through the 12th of the month. This is the same time period the Bureau of Labor and Statistics uses for their survey.”

This was close to the consensus forecast for 20,000,000 private sector jobs lost in the ADP report.

The BLS report will be released Friday, and the consensus is for 21,000,000 non-farm payroll jobs lost in April.

by Calculated Risk on 5/06/2020 07:00:00 AM

From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 0.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending May 1, 2020.

... The Refinance Index decreased 2 percent from the previous week and was 210 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 6 percent from one week earlier. The unadjusted Purchase Index increased 7 percent compared with the previous week and was 19 percent lower than the same week one year ago.
...
“Mortgage application volume was unchanged last week, even as the 30-year fixed rate mortgage declined to 3.40 percent – a new record in MBA’s survey,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “Despite lower rates, refinance applications dropped, as many lenders are offering higher rates for refinances than for purchase loans, and others are suspending the availability of cash-out refinance loans because of their inability to sell them to Fannie Mae and Freddie Mac.”

Added Fratantoni, “Purchase volume increased for the third week in a row, led by strong growth in Arizona, Texas and California. Although purchase activity remains almost 19 percent below year-ago levels, this annualized deficit has decreased as more states reopen amidst the apparent, pent-up demand for homebuying.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.40 percent from 3.43 percent, with points decreasing to 0.30 from 0.34 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.


The first graph shows the refinance index since 1990.

The refinance index has been very volatile recently depending on rates and liquidity.

But the index is way up from last year (over triple last year).

The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is down 19% year-over-year.

Purchase activity has fallen sharply, but was up 6% week over week.

Note: Red is a four-week average (blue is weekly).

by Calculated Risk on 5/05/2020 08:04:00 PM

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

• At 8:15 AM, The ADP Employment Report for April. This report is for private payrolls only (no government). The consensus is for 20,000,000 payroll jobs lost in April, down from 27,000 lost in March.

by Calculated Risk on 5/05/2020 05:05:00 PM

The US might be able to test 400,000 to 600,000 people per day sometime in May according to Dr. Fauci - and that would probably be sufficient for test and trace.

There were 259,150 test results reported over the last 24 hours (the number of tests yesterday were revised up).

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 8.6% (red line). The US probably needs enough tests to push  the percentage positive below 5%. (probably much lower based on testing in New Zealand).

by Calculated Risk on 5/05/2020 03:03:00 PM

From the Las Vegas Visitor Authority: March 2020 Las Vegas Visitor Statistics

Reflecting the impacts of travel restrictions imposed in the middle of March in response to the Covid-19 pandemic, all key indicators saw dramatic YoY reductions.

Las Vegas hosted an estimated 1.5 million visitors (-58.6%) during the month as the destination was effectively empty for the second half of the month. Likewise, convention attendance saw a YoY decrease of -54.8%.

Here is the data from the Las Vegas Convention and Visitors Authority.

Click on graph for larger image.

The blue and red bars are monthly visitor traffic (left scale) for 2019 and 2020.   The dashed blue and orange lines are convention attendance (right scale). 

Convention traffic in March as down 54.8% compared to March 2019.  And visitor traffic was down 58.6% YoY.

The numbers for April will be much worse.

by Calculated Risk on 5/05/2020 10:18:00 AM

The April ISM Non-manufacturing index was at 41.8%, down from 52.5% in March. The employment index decreased to 30.0%, from 47.0%. Note: Above 50 indicates expansion, below 50 contraction.

From the Institute for Supply Management: April 2020 Non-Manufacturing ISM Report On Business®

conomic activity in the non-manufacturing sector contracted in April for the first time since December 2009, ending a 122-month period of growth, say the nation's purchasing and supply executives in the latest Non-Manufacturing ISM® Report On Business®.

The report was issued today by Anthony Nieves, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Non-Manufacturing Business Survey Committee: "The NMI® registered 41.8 percent, 10.7 percentage points lower than the March reading of 52.5 percent. This reading represents contraction in the non-manufacturing sector and is the NMI®'s lowest since March 2009 (40.1 percent). The Business Activity Index fell 22 percentage points from March's figure, registering 26 percent — the lowest reading for that index since the debut of the Non-Manufacturing ISM® Report On Business® in 1997. The New Orders Index registered 32.9 percent, 20 percentage points below the reading of 52.9 percent in March. The Employment Index decreased to 30 percent, 17 percentage points below the March reading of 47 percent.

"The Supplier Deliveries Index registered an all-time high of 78.3 percent, up 16.2 percentage points from the March reading of 62.1 percent, which limited the decrease in the composite NMI®. The Supplier Deliveries Index is one of four equally weighted subindexes that directly factor into the NMI®, along with Business Activity, New Orders and Employment. Supplier Deliveries is the only ISM® Report On Business® index that is inversed; a reading of above 50 percent indicates slower deliveries, which is typical as the economy improves and customer demand increases. However, the combined 25.9-percentage point increase in March and April was primarily a product of supply problems related to the coronavirus (COVID-19) pandemic.
emphasis added

The headline index understated the weakness in the survey. The Supplier Deliveries index boosted the composite NMI, while other indexes hit record lows.

by Calculated Risk on 5/05/2020 08:55:00 AM

Notes: This CoreLogic House Price Index report is for March. The recent Case-Shiller index release was for February. The CoreLogic HPI is a three month weighted average and is not seasonally adjusted (NSA).

From CoreLogic: CoreLogic Reports March Home Prices Increased by 4.5% Year Over Year

CoreLogic® ... oday released the CoreLogic Home Price Index (HPI™) and HPI Forecast™ for March 2020. Home prices increased nationally by 4.5% from March 2019. On a month-over-month basis, prices increased by 1.3% in March 2020. CoreLogic HPI Forecast indicates annual price growth of 0.5% from March 2020 to March 2021, with a month-over-month increase of 0.6% between March and April 2020.

Increased homes sales in January and February 2020 accounts for the sustained acceleration of home prices seen in the March HPI. CoreLogic continues to monitor shifts in the housing market and economy in light of COVID-19, and, in the coming weeks, homebuying activity will likely continue to be tempered by unemployment and recommended ongoing social distancing practices. We can expect to see home price growth slow drastically in response to this declining demand, with the HPI Forecast predicting less than 1% annual increase in home prices by March 2021.

“Home prices for March reflect transactions negotiated primarily in the previous two months, prior to the implementation of the shelter-in-place policies. Rapid decline of purchase activity starting in the middle of March can be seen in other CoreLogic data and is consistent with our HPI forecast of slowing price growth in April,” said Dr. Frank Nothaft, chief economist at CoreLogic. “The first quarter GDP results showed that the country entered a recession in March. Unemployment claims have reached record highs and this economic environment will further impact the housing market into the foreseeable future.”
...
“The CoreLogic U.S. Home Price Index is predicted to remain largely unchanged over the next year or so after a long uninterrupted run of appreciation,” said Frank Martell, president and CEO of CoreLogic. “Although the economic fallout from lockdown orders, put in place to fight the spread of COVID-19, will be profound, the basic supports for a rebound in home purchase activity remain in place. Once the shelter-in-place policies are lifted, we expect millennials, who submitted home-purchase applications well into the crisis, to lead the way back to a positive, purchase-driven housing cycle.”
emphasis added

Click on graph for larger image in graph gallery.

This graph from CoreLogic shows the YoY change in the index - and the CoreLogic forecast.

CR Note: The impact of COVID-19 on house prices will probably not show up for several months. The report next month will be for April, and that is mostly for contracts signed in February and March. The overall impact on house prices will depend on the duration of the crisis.