by Calculated Risk on 8/07/2012 03:30:00 PM

From Tom Lawler:

Freddie Mac reported that its GAAP net income “attributable” to Freddie Mac was $3.020 billion last quarter, up from $577 million in the previous quarter and a net loss of $2.371 billion in the second quarter of 2011. The biggest “swing” factor last quarter was a sharp drop in the provision for credit losses -- $155 million last quarter compared to $1.825 billion in the previous quarter and $2.529 billion in the comparable quarter of last year.

Freddie attributed the sharp drop in its loss provision – which fell far short of charge-offs, resulting in a steep drop in its loan loss reserves – to “improvements in the number of newly impaired loans and to lower estimated future losses due to the positive impact of an increase in national home prices.” Freddie’s internal national home price index, which is based on repeat transactions of homes backed by mortgages owned or guaranteed by Freddie or Fannie with state weights based on Freddie’s SF mortgage book, jumped by 4.8% from March to June, and the June HPI was up about 1.0% from a year ago.

Freddie’s GAAP net income “attributable” to stockholders last quarter was $1.212 billion, reflecting the $1.808 billion in dividends paid to Treasury’s senior preferred stock. Freddie’s GAAP net worth at the end of June was $1.086 billion, and as a result Freddie does not need another Treasury “draw.”

On the SF REO front, Freddie’s SF REO acquisitions last quarter totaled 20,003, down from 23,805 in the previous quarter and 24,788 in the second quarter of last year. Freddie’s SF REO dispositions last quarter totaled 26,069, up from 25,033 in the previous quarter but down from 29,348 in the second quarter of last year. As a result, Freddie’s SF REO inventory at the end of June was 53,271, down from 59,307 at the end of March and 60,599 a year ago.

Freddie attributed the relatively low level of REO acquisitions last quarter to (1) the length of the foreclosure process, especially in states that require a judicial foreclosure process; and (2) resource constraints on foreclosure activities for five large servicers involved in a recent settlement with a coalition of state attorneys general and federal agencies.

Click on graph for larger image.

From CR: The following graph shows REO inventory for Freddie.

REO inventory for Freddie decreased in Q2. After Fannie announces results I'll post a graph of REO for the F's (Fannie, Freddie, and the FHA). FHA REO increased in Q2 to 40,217 from 35,613 in Q1.

by Calculated Risk on 8/07/2012 02:30:00 PM

Teacher town hall meeting with Fed Chairman Ben Bernanke: Financial Education

Follow on Twitter #FedTownHall

If Bernanke hints at QE3, it will probably happen in the Q&A.

Live broadcasting by Ustream

by Calculated Risk on 8/07/2012 11:38:00 AM

Press Release: Trulia Reveals Asking Prices Up for Sixth Straight Month

Trulia today released the latest findings from the Trulia Price Monitor and the Trulia Rent Monitor ... Based on the for-sale homes and rentals listed on Trulia, these monitors take into account changes in the mix of listed homes and reflect trends in prices and rents for similar homes in similar neighborhoods through July 31, 2012.

Asking prices on for-sale homes–which lead sales prices by approximately two or more months – increased 0.5 percent in July month over month (M-o-M), seasonally adjusted, for a sixth straight monthly gain. Meanwhile, asking prices rose nationally 1.2 percent quarter over quarter (Q-o-Q), seasonally adjusted. Year-over-year (Y-o-Y) asking prices rose by 1.1 percent; excluding foreclosures, asking prices rose Y-o-Y by 2.7 percent. For the first time, a majority (62 out of 100) of large metros had Y-o-Y price increases.
...
Rents increased Y-o-Y in 24 of the 25 largest rental markets, with rent increases topping 10 percent in San Francisco, Miami, Oakland, Denver, Seattle and Boston. Three months ago, only two large rental markets – San Francisco and Miami – had Y-o-Y rent increases of 10 percent or more. Rents are rising faster than asking prices in 21 of the 25 largest rental markets Y-o-Y.

More from Jed Kolko, Trulia Chief Economist: Step Aside, Florida: Biggest Price Gains Now in the West

Asking prices were up once again month over month in July, by 0.5%. Asking prices have moved up six straight months since February (the May number was revised slightly upward). This means that the sales price gains starting to be reported by Case-Shiller and other indexes should continue throughout the year.

Note: In a few months, Case-Shiller, CoreLogic and others will probably report a month-over-month decline in house prices, Not Seasonally Adjusted (NSA). That is the normal seasonal pattern and doesn't mean prices are turning down. These asking prices are SA (Seasonally Adjusted) and suggest further house price increases through August and September on a SA basis. The key later this year will be to look at the SA indexes and the year-over-year change in prices.

by Calculated Risk on 8/07/2012 10:16:00 AM

From the BLS: Job Openings and Labor Turnover Summary

There were 3.8 million job openings on the last business day of June, little changed from 3.7 million in May, the U.S. Bureau of Labor Statistics reported today.
...
The level of total nonfarm job openings in June was up from 2.4 million at the end of the recession in June 2009.
...
In June, the quits rate was unchanged for total nonfarm, total private, and government. The number of quits was 2.1 million in June, up from 1.8 million at the end of the recession in June 2009. ... Quits are generally voluntary separations initiated by the employee. Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs.

The following graph shows job openings (yellow line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.

This series started in December 2000.

Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for June, the most recent employment report was for July.

Click on graph for larger image.

Notice that hires (dark blue) and total separations (red and light blue columns stacked) are pretty close each month. When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs.

Jobs openings increased in June to 3.762 million, up from 3.657 million in May. The number of job openings (yellow) has generally been trending up, and openings are up about 16% year-over-year compared to June 2011. This is the most job openings since mid-2008.

Quits decreased slightly in June, however quits are up about 9.5% year-over-year. These are voluntary separations and more quits might indicate some improvement in the labor market. (see light blue columns at bottom of graph for trend for "quits").

All current employment graphs

by Calculated Risk on 8/07/2012 08:52:00 AM

Notes: This CoreLogic House Price Index report is for June. The Case-Shiller index released last week was for May. Case-Shiller is currently the most followed house price index, however CoreLogic is used by the Federal Reserve and is followed by many analysts. The CoreLogic HPI is a three month weighted average and is not seasonally adjusted (NSA).

From CoreLogic: CoreLogic® June Home Price Index Rises 2.5 Percent—Representing Fourth Consecutive Year-Over-Year Increase

Home prices nationwide, including distressed sales, increased on a year-over-year basis by 2.5 percent in June 2012 compared to June 2011. On a month-over-month basis, including distressed sales, home prices increased by 1.3 percent in June 2012 compared to May 2012. The June 2012 figures mark the fourth consecutive increase in home prices nationally on both a year-over-year and month-over-month basis.

Excluding distressed sales, home prices nationwide increased on a year-over-year basis by 3.2 percent in June 2012 compared to June 2011. On a month-over-month basis excluding distressed sales, home prices increased 2.0 percent in June 2012 compared to May 2012, the fifth consecutive month-over-month increase. Distressed sales include short sales and real estate owned (REO) transactions.

The CoreLogic Pending HPI indicates that July home prices, including distressed sales, will rise by at least 0.4 percent on a month-over-month basis from June 2012 and by 2.0 percent on a year-over-year basis from July 2011.

“Home prices are responding positively to reductions in both visible and shadow inventory over the past year,” said Mark Fleming, chief economist for CoreLogic. “This trend is a bright spot because the decline in shadow inventory translates to fewer distressed sales, which helps sustain price appreciation.”

Click on graph for larger image.

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

The index was up 1.3% in May, and is up 2.5% over the last year.

The index is off 29% from the peak - and is up 7% from the post-bubble low set in February (the index is NSA, so some of the increase is seasonal).

The second graph is from CoreLogic. The year-over-year comparison has turned positive.

This is the fourth consecutive month with a year-over-year increase, and excluding the tax credit bump, these are the first year-over-year increases since 2006.