by Calculated Risk on 12/08/2020 01:52:00 PM

Note: Inventory is down sharply in the Northwest almost everywhere except Seattle. And inventory is low in Seattle too.

The Northwest Multiple Listing Service reported Northwest MLS brokers say real estate activity across Washington remains strong

The Northwest MLS report summarizing November activity shows strong year-over-year (YOY) increases in closed sales (up about 23%) and prices (up 13.8%). Pending sales (mutually accepted offers) rose 7.9% from a year ago, and the year’s saga of depleted inventory continued last month with the number of total listings down nearly 43%.
...
Windermere Chief Economist Matthew Gardner said even though the housing market has started to show some signs of its traditional winter slowdown “activity remains higher than we would normally see at this time of year. This isn’t too surprising given the fact that the spring selling season was essentially cancelled due to COVID-19.”
emphasis added

The press release is for the Northwest MLS area. There were 8,875 closed sales in November 2020, up 23.0% from 7,216 sales in November 2019.

In King County, sales were up 23% year-over-year, and active inventory was down 18% year-over-year.

In Seattle, sales were up 22.2% year-over-year, and inventory was up 27% year-over-year..  This puts the months-of-supply in Seattle at just 1.7 months.

by Calculated Risk on 12/08/2020 11:52:00 AM

From the NMHC: NMHC Rent Payment Tracker Finds 75.4 Percent of Apartment Households Paid Rent as of December 6

The National Multifamily Housing Council (NMHC)’s Rent Payment Tracker found 75.4 percent of apartment households made a full or partial rent payment by December 6 in its survey of 11.5 million units of professionally managed apartment units across the country.

This is a 7.8 percentage point, or 894,864 household decrease from the share who paid rent through December 6, 2019 and compares to 80.4 percent that had paid by November 6, 2020. It should be noted that December 5th and 6th fell on a weekend in 2020 and therefore may not be a direct comparison to last year’s figures. These data encompass a wide variety of market-rate rental properties across the United States, which can vary by size, type and average rental price.

"While the initial rent collection figures for the first week of December are concerning, only a full month's results will paint a complete picture. However, it should not come as a surprise that a rising number of households are struggling to make ends meet. As the nation enters a winter with increasing COVID-19 case levels and even greater economic distress – as indicated by last week’s disquieting employment report - it is only a matter of time before both renters and housing providers reach the end of their resources,” said Doug Bibby, NMHC President.
emphasis added

Click on graph for larger image.

This graph from the NMHC Rent Payment Tracker shows the percent of household making full or partial rent payments by the 6th of the month.

This is mostly for large, professionally managed properties.  

The second graph shows full month payments through November.

This shows a decline in rent payments year-over-year, and somewhat more of a decline over the last several months.

CR Note: There are some timing issues month to month, but rent payments appear to be declining, and December is off to a slow start.
 

by Calculated Risk on 12/08/2020 08:26:00 AM

This report is for closed sales in November; sales are counted at the close of escrow, so the contracts for these homes were mostly signed in September and October.

The Las Vegas Realtors reported Southern Nevada home prices set record for sixth straight month amid pandemic; LVR housing statistics for November 2020

LVR reported a total of 3,761 existing local homes, condos and townhomes were sold during November. Compared to the same time last year, November sales were up 26.1% for homes and up 34.7% for condos and townhomes.

“Like other places around the country, we’re seeing multiple offers on properties listed for sale,” said 2020 LVR President Tom Blanchard, a longtime local REALTOR®. “The supply of available homes is very low, and demand is high. I hope the new year will bring some additional inventory as local homeowners start to feel more comfortable moving. We can easily absorb three or four times the current available inventory without tilting the scales of meeting our current demand for housing here in Southern Nevada.”

He said the number of local homes available for sale remains well below the six-month supply considered to be a balanced market. In fact, the sales pace in November equates to just over a one-month supply of homes available for sale, creating what Blanchard said is a local housing shortage.

By the end of November, LVR reported 3,756 single-family homes listed for sale without any sort of offer. That’s down 42.5% from one year ago. For condos and townhomes, the 1,288 properties listed without offers in November represent a 24.7% drop from one year ago.
…
Despite the coronavirus crisis and economic downturn, the number of so-called distressed sales remains near historically low levels. LVR reported that short sales and foreclosures combined accounted for just 0.8% of all existing local property sales in November. That compares to 2.0% of all sales one year ago, 2.6% two years ago and just under 5% three years ago.
emphasis added

1) Overall sales were up 27.7% year-over-year to 3,761 in November 2020 from 2,946 in November 2019.

2) Active inventory (single-family and condos) is down from a year ago, from a total of 8,242 in 2019 to 3,756 in November 2020. Note: Total inventory was down 54.4% year-over-year.   And months of inventory is low.

3) Low level of distressed sales.

by Calculated Risk on 12/07/2020 07:22:00 PM

I'm looking forward to not posting this data in a few months. Please stay healthy!

The US is now averaging over 1 million tests per day. Based on the experience of other countries, for adequate test-and-trace (and isolation) to reduce infections, the percent positive needs to be well under 5% (probably close to 1%), so the US still needs to increase the number of tests per day significantly (or take actions to push down the number of new infections).

There were 1,566,574 test results reported over the last 24 hours.

There were 180,193 positive tests.

Over 15,000 US deaths have been reported so far in December. See the graph on US Daily Deaths here.

Click on graph for larger image.

This data is from the COVID Tracking Project.

The percent positive over the last 24 hours was 11.5% (red line is 7 day average).  The percent positive is calculated by dividing positive results by the sum of negative and positive results (I don't include pending).

And check out COVID Exit Strategy to see how each state is doing.

The second graph shows the 7 day average of positive tests reported and daily hospitalizations.

Note that there were very few tests available in March and April, and many cases were missed, so the hospitalizations was higher relative to the 7-day average of positive tests in July.

• Record Hospitalizations (Over 102,000)

• Record 7 Day Average Cases

• Record 7 Day Average Deaths

by Calculated Risk on 12/07/2020 06:26:00 PM

Note: This is as of November 29th.

From the MBA: Share of Mortgage Loans in Forbearance Remains Flat at 5.54%

he Mortgage Bankers Association's (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance remained unchanged relative to the prior week at 5.54% as of November 29, 2020. According to MBA's estimate, 2.8 million homeowners are in forbearance plans.
...
"After two weeks of increases, the share of loans in forbearance was unchanged for the week that included Thanksgiving. A small decline in forbearances for GSE loans was offset by increases for Ginnie Mae and portfolio loans," said Mike Fratantoni, MBA's Senior Vice President and Chief Economist. "While new forbearance requests declined for the week, exits slowed to a new low for the series."

Added Fratantoni, "The job market data for November showed an economic recovery that was slowing in response to the latest surge in COVID-19 cases. It is not surprising to see the rate of forbearance exits slow, as households that needed forbearance assistance in October may be in even greater need now."
...
By stage, 19.81% of total loans in forbearance are in the initial forbearance plan stage, while 77.90% are in a forbearance extension. The remaining 2.29% are forbearance re-entries.
emphasis added

Click on graph for larger image.

This graph shows the percent of portfolio in forbearance by investor type over time.  Most of the increase was in late March and early April, and has been trending down for the last few months.

The MBA notes: "Total weekly forbearance requests as a percent of servicing portfolio volume (#) decreased relative to the prior week: from 0.11% to 0.08%."

by Calculated Risk on 12/07/2020 01:35:00 PM

From Dodge Data Analytics: Dodge Momentum Index Steps Lower in November

The Dodge Momentum Index fell 2.6% in November to 123.3 (2000=100) from the revised October reading of 126.5. The Momentum Index, issued by Dodge Data & Analytics, is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. The institutional component of the Momentum Index fell 4.4%, while the commercial component lost 1.6%.

Since the expiration of support programs in the CARES Act, the economy has struggled to maintain traction and in its wake planning for nonresidential building projects has slowed. As the next wave of COVID-19 infections quickly approaches economic growth and job gains will ease further. Additionally, uncertainty over the potential for further federal stimulus has significantly complicated the recovery and will continue to negatively impact nonresidential building throughout the planning and construction processes.
emphasis added

Click on graph for larger image.

This graph shows the Dodge Momentum Index since 2002. The index was at 123.3 in November, down from 126.5 in October.

According to Dodge, this index leads "construction spending for nonresidential buildings by a full year".  This index suggests a decline in Commercial Real Estate construction through most of 2021.

by Calculated Risk on 12/07/2020 11:31:00 AM

The employment diffusion indexes are useful in indicating how widespread job gains are in a given month.

The BLS diffusion index for total private employment was at 58.7 in November, down from 70.7 in October.

For manufacturing, the diffusion index was at 58.6, down from 60.5 in October.

Think of this as a measure of how widespread job gains or losses are across industries. The further from 50 (above or below), the more widespread the job losses or gains reported by the BLS.  From the BLS:

Figures are the percent of industries with employment increasing plus one-half of the industries with unchanged employment, where 50 percent indicates an equal balance between industries with increasing and decreasing employment.

Click on graph for larger image.

Both indexes declined sharply in March 2020, and collapsed to new record lows in April, due to the impact from COVID-19.

Then the indexes increased as the economy bounced back.

Both indexes declined in October, but are still at decent levels, indicating job growth was fairly widespread across industries.

by Calculated Risk on 12/07/2020 11:25:00 AM

Black Knight released their Mortgage Monitor report for October today. According to Black Knight, 6.44% of mortgages were delinquent in October, down from 6.66% of mortgages in September, and up from 3.39% in October 2019. Black Knight also reported that 0.33% of mortgages were in the foreclosure process, down from 0.48% a year ago.

This gives a total of 6.77% delinquent or in foreclosure.

Press Release: 2020 On Pace to See More than 9 Million Refinance Transactions; 82% of Refinancing Borrowers Not Retained

Today, the Data & Analytics division of Black Knight, Inc. (NYSE:BKI) released its latest Mortgage Monitor Report, based upon the company’s industry-leading mortgage performance, real estate and public records datasets. This month, the company looked into Q3 2020 mortgage originations – with a focus on refinance lending – and mortgage servicers’ success in retaining the business of refinancing homeowners. As Black Knight Data & Analytics President Ben Graboske explained, while Q3 2020 quarterly origination volumes broke records across the board, retention rates have suffered amid the surge of lending activity.

“As our rate lock data had suggested last month, Q3 2020 originations hit record highs in purchase, refinance and overall lending as record-low mortgage rates and a delay to the normal spring home-buying season spurred both the purchase and refinance markets,” said Graboske. “Some 2.7 million homeowners refinanced their first-lien mortgages in the third quarter, bringing the total through September 2020 to 6.4 million. What’s more, consolidated rate lock data from Black Knight’s Compass Analytics and Optimal Blue divisions suggests that number could climb above 9 million by year’s end. And, with rates continuing to sit at record lows, refinance incentive remains at historic highs. As of the last week of November, 19.4 million 30-year mortgage holders could likely both qualify for and benefit from a refinance.
emphasis added

Click on graph for larger image.

Here is a graph from the Mortgage Monitor that shows first lien refinance activity.

From Black Knight:

• Through the first three quarters of the year, some 6.4 million homeowners have refinanced their primary mortgage, with that number on pace to climb above 9 million by the end of the year

• While cash-out activity has ridden the wave higher, cash-outs only made up 27% of Q3 refinance lending, the lowest such share in seven years

• The average cash-out amount fell to $51,600 (from $63,000 in Q2), pushing the volume of equity withdrawn in Q3 to down $37 billion, the lowest such equity withdrawal volume since Q2 2019

• This suggests cashing out equity was a distant second priority to borrowers locking in record low rates as their primary driver to refinance

And on delinquencies from Black Knight:

• Delinquencies improved in October, falling to 6.44%, their lowest level since March

• Despite five consecutive months of improvement, there are still nearly 2X as many delinquent mortgages (+1.6 million/+91%) as there were entering 2020

• Serious delinquencies (90+ Days) improved in October as well, but volumes remain at more than 5x (+1.8M) their pre-pandemic levels

• Though COVID-19 case rates are rising across the country, new delinquencies remain below the three-month average and have been unaffected by these surges, at least for now

There is much more in the mortgage monitor.

by Calculated Risk on 12/07/2020 08:50:00 AM

These indicators are mostly for travel and entertainment.    It will interesting to watch these sectors recover as the vaccine is distributed.   

IMPORTANT: Be safe now - if all goes well, we could all be vaccinated by Q2 2021.

----- Airlines: Transportation Security Administration -----
The TSA is providing daily travel numbers.

Click on graph for larger image.

This data shows the seven day average of daily total traveler throughput from the TSA for 2019 (Blue) and 2020 (Red).

The dashed line is the percent of last year for the seven day average.

This data is as of December 6th.

The seven day average is down 65.5% from last year (34.5% of last year).  (Dashed line)

There had been a slow increase from the bottom, but has declined following the Thanksgiving week holiday.

----- Restaurants: OpenTable -----
The second graph shows the 7 day average of the year-over-year change in diners as tabulated by OpenTable for the US and several selected cities.

Thanks to OpenTable for providing this restaurant data:

This data is updated through December 5, 2020.

This data is "a sample of restaurants on the OpenTable network across all channels: online reservations, phone reservations, and walk-ins. For year-over-year comparisons by day, we compare to the same day of the week from the same week in the previous year."

Note that this data is for "only the restaurants that have chosen to reopen in a given market". Since some restaurants have not reopened, the actual year-over-year decline is worse than shown.

Note that dining is generally lower in the northern states - Illinois, Pennsylvania, and New York - but declining in the southern states.

----- Movie Tickets: Box Office Mojo -----
This data shows domestic box office for each week (red) and the maximum and minimum for the previous four years.  Data is from BoxOfficeMojo through December 3rd.

Note that the data is usually noisy week-to-week and depends on when blockbusters are released.

Movie ticket sales have picked up slightly over the last couple of months, and were at $16 million last week (compared to usually around $200 million per week).

Some movie theaters have reopened (probably with limited seating).

----- Hotel Occupancy: STR -----
This graph shows the seasonal pattern for the hotel occupancy rate using the four week average.

The red line is for 2020, dash light blue is 2019, blue is the median, and black is for 2009 (the worst year since the Great Depression for hotels - prior to 2020).

This data is through November 28th. Hotel occupancy is currently down 28.5% year-over-year.

Notes: Y-axis doesn't start at zero to better show the seasonal change.

Since there is a seasonal pattern to the occupancy rate, we can track the year-over-year change in occupancy to look for any improvement. This table shows the year-over-year change since the week ending Sept 19, 2020:

Week Ending	YoY Change, Occupancy Rate
9/19	-31.9%
9/26	-31.5%
10/3	-29.6%
10/10	-29.2%
10/17	-30.7%
10/24	-31.7%
10/31	-29.0%
11/7	-35.9%
11/14	-32.7%
11/21	-32.6%
11/28	-28.5%

This suggests no improvement over the last 11 weeks.

----- Gasoline Supplied: Energy Information Administration -----
This graph, based on weekly data from the U.S. Energy Information Administration (EIA), shows gasoline supplied compared to the same week last year of .

At one point, gasoline supplied was off almost 50% YoY.

As of November 27th, gasoline supplied was off about 11.7% YoY (about 88.3% of last year).

Note: People driving instead of flying might have boosted gasoline consumption over the summer.

----- Transit: Apple Mobility -----
This graph is from Apple mobility. From Apple: "This data is generated by counting the number of requests made to Apple Maps for directions in select countries/regions, sub-regions, and cities." This is just a general guide - people that regularly commute probably don't ask for directions.

There is also some great data on mobility from the Dallas Fed Mobility and Engagement Index. However the index is set "relative to its weekday-specific average over January–February", and is not seasonally adjusted, so we can't tell if an increase in mobility is due to recovery or just the normal increase in the Spring and Summer.

This data is through December 5th for the United States and several selected cities.

The graph is the running 7 day average to remove the impact of weekends.

IMPORTANT: All data is relative to January 13, 2020. This data is NOT Seasonally Adjusted. People walk and drive more when the weather is nice, so I'm just using the transit data.

According to the Apple data directions requests, public transit in the 7 day average for the US is at 46% of the January level. It is at 33% in Chicago, and 52% in Houston - and declining recently (the bump down and up was due to Thanksgiving).

----- New York City Subway Usage -----
Here is some interesting data on New York subway usage (HT BR).

This graph is from Todd W Schneider. This is daily data for this year.

This data is through Friday, December 4th.

Schneider has graphs for each borough, and links to all the data sources.

He notes: "Data updates weekly from the MTA’s public turnstile data, usually on Saturday mornings".

by Calculated Risk on 12/06/2020 09:23:00 PM

Weekend:
• Schedule for Week of December 6, 2020

Monday:
• At 3:00 PM, Consumer Credit from the Federal Reserve.

From CNBC: Pre-Market Data and Bloomberg futures S&P 500 and DOW futures are up slightly (fair value).

Oil prices were up over the last week with WTI futures at $46.19 per barrel and Brent at $49.19 barrel. A year ago, WTI was at $58, and Brent was at $65 - so WTI oil prices are down about 25% year-over-year.

Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $2.16 per gallon. A year ago prices were at $2.60 per gallon, so gasoline prices are down $0.44 per gallon year-over-year.