by Calculated Risk on 7/20/2012 02:53:00 PM

Low rates and HARP are driving activity ...

From Jon Prior at HousingWire: Big-four mortgage originations climb 37%

Mortgage originations at the big-four banks increased 37% in the second quarter from last year because of the expanded Home Affordable Refinance Program.
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Wells continued to dominate. The San Francisco bank wrote $131.9 billion in new loans during the quarter, more than double originations from the same period last year. Wells said 16% of those new loans came through the Home Affordable Refinancing Program.
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Chase wrote $43.9 billion in new mortgages during the quarter, up 29% from last year and 14.3% from the previous quarter.
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Bank of America continues to feel the drop off from exiting its correspondent lending channel last year. Originations fell 55% from one year ago to roughly $18 billion, the only yearly decline of the big-four lenders.
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Citi originations totaled $12.9 billion, up 17% from last year but still down 10% from the previous quarter.

If the Fed does expand their balance sheet ("QE3") on Aug 1st, or at the September meeting, the purchases will probably be focused on agency mortgage backed securities. The people able to refinance might even get even lower rates, but many prospective borrowers will still be unable to refinance.

by Calculated Risk on 7/20/2012 11:13:00 AM

From the BLS: Regional and State Employment and Unemployment Summary

Regional and state unemployment rates were little changed in June. Twenty-seven states recorded unemployment rate increases, 11 states and the District of Columbia posted rate decreases, and 12 states had no change, the U.S. Bureau of Labor Statistics reported today.
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Nevada continued to record the highest unemployment rate among the states, 11.6 percent in June. Rhode Island and California posted the next highest rates, 10.9 and 10.7 percent, respectively. North Dakota again registered the lowest jobless rate, 2.9 percent, followed by Nebraska, 3.8 percent.

Click on graph for larger image in graph gallery.

This graph shows the current unemployment rate for each state (red), and the max during the recession (blue). New York is at the maximum unemployment rate for the recession - every other state has some blue indicating some improvement. New Jersey is close to the recession maximum.

The states are ranked by the highest current unemployment rate. Only three states still have double digit unemployment rates: Nevada, Rhode Island, and California. This is the fewest since January 2009. In early 2010, 18 states and D.C. had double digit unemployment rates.

It appears some of the "sand states", with the largest housing bubbles, are starting to see faster declines in the unemployment rate (Arizona, Florida, California and Nevada).
All current employment graphs

by Calculated Risk on 7/20/2012 08:47:00 AM

From the WSJ: Euro Zone Approves Terms of Spain Bank Bailout

Luxembourg Finance Minister Luc Frieden told reporters there had been a "formal" adoption of the country's memorandum of understanding—the official document outlining the details of the financial assistance package.
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The bailout will pump up to €100 billion euros ($123 billion) into ailing Spanish banks and will aim to restore the country's financial sector.
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Also Friday, Spain's government said it expects the economy to remain in recession next year as it steps up austerity measures.

The yield on the Spanish 10 year bond is now above 7.2% - near the high.

More austerity. More recession. The beatings continue ...

by Calculated Risk on 7/19/2012 06:57:00 PM

Here is a sector that is growing ... expecting more imports from Asia:

From Ronald White at the LA Times: Ports of Los Angeles and Long Beach building at furious pace

At the edge of San Pedro Bay, home of North America's largest cargo complex, they're building new piers, wharves and rail yards at a furious pace ... So much construction is underway that the new facilities by themselves would move more freight than the entire port of Savannah, Ga., which ranks No. 4 among the continent's ports.
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The most expensive and extensive upgrades in the history of both ports will cost nearly $6 billion.
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About 640,000 people work in trade-related jobs in [SoCal] ... That's up from a low of fewer than 600,000 during the recession, but still far short of the 709,000 trade jobs in pre-recession 2007.

Earlier on Existing Home Sales:
• Existing Home Sales in June: 4.37 million SAAR, 6.6 months of supply
• Existing Home Sales: Inventory and NSA Sales Graph
• Existing Home Sales graphs

by Calculated Risk on 7/19/2012 04:04:00 PM

In addition to Case-Shiller, CoreLogic, and LPS, I'm also watching the FNC, Zillow and other house price indexes.

FNC released their May index data today. FNC reported that their Residential Price Index™ (RPI) indicates that U.S. residential property values increased 0.6% in May (Composite 100 index). The other RPIs (10-MSA, 20-MSA, 30-MSA) increased between 0.5% and 0.8% in May. These indexes are not seasonally adjusted (NSA), and are for non-distressed home sales (excluding foreclosure auction sales, REO sales, and short sales).

The year-over-year trends continued to show improvement in May, with all four composite indexes down 1.8% to 2.1% compared to May 2011. For all the indexes, this is the smallest year-over-year decline in the FNC index since year-over-year prices started falling in 2007 (five years ago).

Click on graph for larger image.

This graph is based on the FNC index (four composites) through May 2012. The FNC indexes are hedonic price indexes using a blend of sold homes and real-time appraisals.

Some of the month-to-month gain is seasonal since this index is NSA. The key is the indexes are showing less of a year-over-year decline in May. If house prices have bottomed, the year-over-year decline should turn positive later this year or early in 2013.

The May Case-Shiller index will be released Tuesday, July 31st.

Earlier on Existing Home Sales:
• Existing Home Sales in June: 4.37 million SAAR, 6.6 months of supply
• Existing Home Sales: Inventory and NSA Sales Graph
• Existing Home Sales graphs