by Calculated Risk on 4/16/2021 12:31:00 PM

Note: Both Black Knight and the MBA (Mortgage Bankers Association) are putting out weekly estimates of mortgages in forbearance.

This data is as of April 13th.

From Black Knight: Forbearances Improve for Seventh Straight Week

The country saw a modest decrease in the number of active forbearance plans this week, falling by just 1,000 but still marking the seventh consecutive week of improvement.

This mid-month lull in improvement was expected – they’ve become commonplace during the recovery, with the strongest rates of improvement seen early and late in the month as mortgages are reviewed for extension/removal from forbearance. With 380,000 loans still slated for these reviews by the end of this month, we could still see additional forbearance improvement in late April/early May.

Click on graph for larger image.

Plan starts hit their highest level in three weeks, but this was primarily due to re-starts, as a portion of the nearly 500,000 homeowners who’d left forbearance in recent weeks likely reached out to their servicers to reinstate their plans. New plan starts remain near post-pandemic lows.

Despite the marginal improvement this week, the number of outstanding plans is still down by 296,000 (-11.4% month-over-month) marking considerable improvement in recent weeks. As of April 13, there are now 2.3 million homeowners in COVID-19-related forbearance plans, representing 4.4% of all mortgage-holders.

We’ll continue to monitor the situation, and will have another report published here next Friday, April 23.
emphasis added

The number of loans in forbearance continues to decline.

by Calculated Risk on 4/16/2021 11:19:00 AM

Note that the forecasts of the automated systems (based on released data), have caught up with the forecasts of economists, as data for March is released.

From Merrill Lynch:

Despite robust retail sales growth, it was less bullish than our forecast, resulting in a 0.5pp reduction to our 1Q GDP tracking estimate, to 6.5% qoq saar. [Apr 16 estimate]
emphasis added

From Goldman Sachs:

We left our Q1 GDP tracking estimate unchanged on a rounded basis at +7.5% (qoq ar). [Apr 16 estimate]

From the NY Fed Nowcasting Report

The New York Fed Staff Nowcast stands at 6.8% for 2021:Q1 and 4.4% for 2021:Q2. [Apr 16 estimate]

And from the Altanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2021 is 8.3 percent on April 16, unchanged from April 15 after rounding. After this morning's housing starts report from the U.S. Census Bureau, the nowcast of first-quarter real residential investment growth decreased from 10.6 percent to 10.2 percent. [Apr 16 estimate]

by Calculated Risk on 4/16/2021 09:36:00 AM

Earlier: Housing Starts increased to 1.739 Million Annual Rate in March

This was the highest level for starts since June 2006.

Total housing starts in March were above expectations, and starts in January and February were revised up. Single family starts increased in March, and were up 41% year-over-year (starts declined at the beginning of the pandemic). 

The volatile multi-family sector is up year-over-year (apartments were under pressure from COVID).

The housing starts report showed total starts were up 19.4% in March compared to February, and total starts were up 37.0% year-over-year compared to March 2020.

Low mortgage rates and limited existing home inventory have given a boost to single family housing starts.

The first graph shows the month to month comparison for total starts between 2020 (blue) and 2021 (red). 

Click on graph for larger image.

Starts were up 37.0% in March compared to March 2020.  The year-over-year comparison will be easy again in April, May and June.  

2020 was off to a strong start before the pandemic, and with low interest rates and little competing existing home inventory, starts finished 2020 strong.  Starts have started 2021 strong (February was impacted by the harsh weather).

Below is an update to the graph comparing multi-family starts and completions. Since it usually takes over a year on average to complete a multi-family project, there is a lag between multi-family starts and completions. Completions are important because that is new supply added to the market, and starts are important because that is future new supply (units under construction is also important for employment).

These graphs use a 12 month rolling total for NSA starts and completions.

The blue line is for multifamily starts and the red line is for multifamily completions.

The rolling 12 month total for starts (blue line) increased steadily for several years following the great recession - then mostly moved sideways.  Completions (red line) had lagged behind - then completions caught up with starts- then starts picked up a little again late last year, but have fallen off with the pandemic.

The last graph shows single family starts and completions. It usually only takes about 6 months between starting a single family home and completion - so the lines are much closer. The blue line is for single family starts and the red line is for single family completions.

Single family starts are getting back to more normal levels, but I still expect some further increases in single family starts and completions on a rolling 12 month basis - especially given the low level of existing home inventory.

by Calculated Risk on 4/16/2021 08:39:00 AM

From the Census Bureau: Permits, Starts and Completions

Housing Starts:
Privately-owned housing starts in March were at a seasonally adjusted annual rate of 1,739,000. This is 19.4 percent above the revised February estimate of 1,457,000 and is 37.0 percent above the March 2020 rate of 1,269,000. Single-family housing starts in March were at a rate of 1,238,000; this is 15.3 percen above the revised February figure of 1,074,000. The March rate for units in buildings with five units or more was 477,000.

Building Permits:
Privately-owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 1,766,000. This is 2.7 percent above the revised February rate of 1,720,000 and is 30.2 percent above the March 2020 rate of 1,356,000. Single-family authorizations in March were at a rate of 1,199,000; this is 4.6 percent (±1.9 percent) above the revised February figure of 1,146,000. Authorizations of units in buildings with five units or more were at a rate of 508,000 in March.
emphasis added

Click on graph for larger image.

The first graph shows single and multi-family housing starts for the last several years.

Multi-family starts (red, 2+ units) increased in March compared to February.   Multi-family starts were up 29% year-over-year in March.

Single-family starts (blue) increased in March, and were up 41% year-over-year (starts slumped at the beginning of the pandemic).   

The second graph shows total and single unit starts since 1968.

The second graph shows the huge collapse following the housing bubble, and then the eventual recovery (but still not historically high).

Total housing starts in March were well above expectations, and starts in January and February were revised up.

I'll have more later …

by Calculated Risk on 4/15/2021 09:00:00 PM

Friday:
• At 8:30 AM ET, Housing Starts for March. The consensus is for 1.600 million SAAR, up from 1.421 million SAAR in February.

• At 10:00 AM, University of Michigan's Consumer sentiment index (Preliminary for April).

• Also at 10:00 AM, State Employment and Unemployment (Monthly) for March 2021

by Calculated Risk on 4/15/2021 04:44:00 PM

Note: I'm looking forward to not posting this daily! I've been posting this data daily for over a year, and I'll stop once all three of these criteria are met:
1) 70% of the population over 18 has had at least one dose of vaccine,
2) new cases are under 5,000 per day, and
3) hospitalizations are below 3,000.

According to the CDC, 198.3 million doses have been administered. 30.3% of the population over 18 is fully vaccinated, and 48.3% of the population over 18 has had at least one dose (124.8 million people have had at least one dose).

And check out COVID Act Now to see how each state is doing. 

Almost 9,500 US deaths were reported so far in April due to COVID.

Click on graph for larger image.

This graph shows the daily (columns) 7 day average (line) of positive tests reported.

Note: The ups and downs during the Winter surge were related to reporting delays due to the Thanksgiving and Christmas holidays.

This data is from the CDC.

The 7-day average is 69,577, down from 69,953 yesterday, and above the summer surge peak of 67,337 on July 23, 2020.

The second graph shows the number of people hospitalized.

This data is also from the CDC.

The CDC cautions that due to reporting delays, the area in grey will probably increase.

The current 7-day average is 37,125, up from 36,941 reported yesterday, and well above the post-summer surge low of 23,000.

by Calculated Risk on 4/15/2021 04:12:00 PM

The Arizona Regional Multiple Listing Service (ARMLS) reports ("Stats Report"):

1) Overall sales were at 9,806 in March, up 13.7% from 8,626 in March 2020.

2) Active inventory was at 4,383, down 69.3% from 14,257 in March 2020.

3) Months of supply decreased to 0.92 in March from 2.11 in March 2020. This is very low.

Sales are reported at the close of escrow, so these sales were mostly signed in January and February.

by Calculated Risk on 4/15/2021 04:03:00 PM

Note: I'm tracking data for many local markets around the U.S. I think it is especially important to watch inventory this year.

For for the entire state Rhode Island:

Closed sales (single family and condos) in March 2021 were 1,029, up 10.1% from 935 in March 2020.

Active Listings (single family and condos)  in March 2021 were 1,637, down 44.4% from 2,945 in March 2020.

by Calculated Risk on 4/15/2021 02:57:00 PM

The National Multifamily Housing Council (NMHC) released their April report: April Apartment Market Conditions Show Improvement

Apartment market conditions showed improvement in the National Multifamily Housing Council’s Quarterly Survey of Apartment Market Conditions for April 2021, as the industry begins to see signs of optimism. While the Sales Volume (77) and Equity Financing (68) indexes both came in above the breakeven level (50) for the third consecutive quarter, the index for Market Tightness (81) signaled tighter conditions for the first time since October 2019. The Debt Financing index (44) indicated weaker conditions.

“We are finally seeing improvement in most markets around the country,” noted NMHC Chief Economist Mark Obrinsky. “While gateway metros are still generally facing lower occupancy and rent levels compared to a year ago, conditions now appear to be on an upward trajectory. On the other hand, many Sun Belt markets continue to see substantial rent growth and strength in fundamentals.”

“Following what we saw as an inflection point last quarter, with a majority of respondents (53 percent) indicating market conditions were unchanged, two-thirds (67 percent) of respondents this quarter observed tighter conditions in their apartment markets. We move forward with cautious optimism, as vaccine rollout is well underway and there is hope that all residents will be able to return to work soon.””
...
The Market Tightness Index increased from 43 to 81, indicating tighter market conditions for the first time in six quarters. Two-thirds (67 percent) of respondents reported tighter market conditions than three months prior, compared to only 5 percent who reported looser conditions. Twenty-eight percent of respondents felt that conditions were no different from last quarter.
emphasis added

Click on graph for larger image.

This graph shows the quarterly Apartment Tightness Index. Any reading above 50 indicates tighter conditions from the previous quarter. 

This indicates market conditions tightened in April, after being very weak for five consecutive quarters, and especially weak in the April and July reports for 2020.

by Calculated Risk on 4/15/2021 11:59:00 AM

Note: The year-over-year occupancy comparisons are easy, since occupancy declined sharply at the onset of the pandemic. However, occupancy is still down significantly from normal levels.

The occupancy rate is down 15% compared to the same week in 2019.

From CoStar: STR: US Hotels Achieve Highest Weekly Demand Level Since Start of COVID-19

The U.S. hotel industry posted its highest demand and occupancy levels since the beginning of the pandemic, according to STR‘s latest weekly data through April 10.

April 4-10, 2021:

• Occupancy: 59.7%
• Average daily rate (ADR): US$112.22
• Revenue per available room (RevPAR): US$66.99

Reflecting the country’s almost 2-point improvement in occupancy from the previous week, more than 50% of properties posted a weekly occupancy above 60%.
emphasis added

For more, see STR's U.S. Market Recovery Monitor

The following graph shows the seasonal pattern for the hotel occupancy rate using the four week average.

Click on graph for larger image.

The red line is for 2021, black is 2020, blue is the median, and dashed light blue is for 2009 (the worst year since the Great Depression for hotels prior to 2020).

Occupancy is now above the horrible 2009 levels.

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