by Calculated Risk on 7/17/2014 09:31:00 AM

The DOL reports:

In the week ending July 12, the advance figure for seasonally adjusted initial claims was 302,000, a decrease of 3,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 304,000 to 305,000. The 4-week moving average was 309,000, a decrease of 3,000 from the previous week's revised average. This is the lowest level for this average since June 2, 2007 when it was 307,500. The previous week's average was revised up by 500 from 311,500 to 312,000.

There were no special factors impacting this week's initial claims.

The previous week was revised up to 305,000.

The following graph shows the 4-week moving average of weekly claims since January 1971.

Click on graph for larger image.


The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased to 309,000.

This was lower than the consensus forecast of 310,000.  The 4-week average is now at normal levels for an expansion.

by Calculated Risk on 7/17/2014 08:30:00 AM

From the Census Bureau: Permits, Starts and Completions

Housing Starts:
Privately-owned housing starts in June were at a seasonally adjusted annual rate of 893,000. This is 9.3 percent below the revised May estimate of 985,000, but is 7.5 percent above the June 2013 rate of 831,000.

Single-family housing starts in June were at a rate of 575,000; this is 9.0 percent below the revised May figure of 632,000. The June rate for units in buildings with five units or more was 305,000.
emphasis added

Building Permits:
Privately-owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 963,000. This is 4.2 percent below the revised May rate of 1,005,000, but is 2.7 percent above the June 2013 estimate of 938,000.

Single-family authorizations in June were at a rate of 631,000; this is 2.6 percent above the revised May figure of 615,000. Authorizations of units in buildings with five units or more were at a rate of 301,000 in June.

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) decreased  in June (Multi-family is volatile month-to-month).

Single-family starts (blue) also decreased in June.

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

 The second graph shows the huge collapse following the housing bubble, and that housing starts have been increasing after moving sideways for about two years and a half years.

This was well below expectations of 1.020 million starts in June.  Note: Starts for April and May were revised slightly lower. I'll have more later.

by Calculated Risk on 7/16/2014 08:59:00 PM

A reminder of a friendly bet I made with NDD on housing starts in 2014 (I've already "won", and NDD made a donation to the Tanta Memorial Fund - but he could still win too):

If starts or sales are up at least 20% YoY in any month in 2014, [NDD] will make a $100 donation to the charity of Bill's choice, which he has designated as the Memorial Fund in honor of his late co-blogger, Tanta. If housing permits or starts are down 100,000 YoY at least once in 2014, he make a $100 donation to the charity of my choice, which is the Alzheimer's Association.

In June 2013, starts were at a 831 thousand seasonally adjusted annual rate (SAAR). For me to win again (only one win counts), starts would have to be up 20% or at 997.2 thousand SAAR in June (very possible). For NDD to win, starts would have to fall to 731 thousand SAAR (not likely). NDD could also "win" if permits fall to 838 thousand SAAR from 938 thousand SAAR in June 2013.

Thursday:
• At 8:30 AM ET, Housing Starts for June. Total housing starts were at 1.001 million (SAAR) in May. Single family starts were at 625 thousand SAAR in May. The consensus is for total housing starts to increase to 1.020 million (SAAR) in June.

• Also at 8:30 AM, the initial weekly unemployment claims report will be released. The consensus is for claims to increase to 310 thousand from 304 thousand.

• At 10:00 AM, the Philly Fed manufacturing survey for July. The consensus is for a reading of 15.5, down from 17.8 last month (above zero indicates expansion).

by Calculated Risk on 7/16/2014 05:56:00 PM

From DataQuick: Bay Area Home Sales Up Slightly; Price Increases Slow

A total of 7,915 new and resale houses and condos sold in the nine-county Bay Area last month. That was up 0.2 percent from 7,898 in May and up 0.2 percent from 7,897 in June last year, according to DataQuick ....

June’s year-over-year increase in sales was the Bay Area’s first since last September, when sales rose 3.6 percent from a year earlier. Since 1988, when DataQuick’s statistics begin, June sales have ranged from a low of 7,118 in 1993 to a high of 15,735 in 2004. Last month’s sales were 20.2 percent below the June average of 9,916 sales since 1988. Bay Area sales haven’t been above average for any particular month in more than eight years.
...
Last month foreclosure resales – homes that had been foreclosed on in the prior 12 months – accounted for 3.1 percent of all resales. That was unchanged from the month before, and down from 5.7 percent a year earlier. Foreclosure resales in the Bay Area peaked at 52.0 percent in February 2009, while the monthly average over the past 17 years is 9.8 percent.

Short sales – transactions where the sale price fell short of what was owed on the property – made up an estimated 4.4 percent of Bay Area resales last month. That was down from an estimated 4.6 percent in May and down from 9.5 percent a year earlier.

Last month absentee buyers – mostly investors – purchased 20.8 percent of all Bay Area homes. That was up slightly from May’s revised 19.3 percent and down from 21.8 percent in June last year.
emphasis added

A few key year-over-year trends: 1) declining distressed sales, 2) generally declining investor buying, 3) flat or declining total sales, but 4) some increase in non-distressed sales. Though total sales were up 0.2% year-over-year, the percent of non-distressed sales was up about 9%.  There were 7,915 total sales this year in June, and only 7.5% were distressed.  In June 2013, there were 7,897 total sales, and 15.2% were distressed.

by Calculated Risk on 7/16/2014 02:07:00 PM

Fed's Beige Book "Prepared at the Federal Reserve Bank of Kansas City and based on information collected before July 7, 2014. "

All twelve Federal Reserve Districts indicated that economic activity continued to expand since the previous report. The pace of economic growth was characterized as moderate in New York, Chicago, Minneapolis, Dallas, and San Francisco, while the remaining Districts reported modest expansion. Compared to the previous reporting period, Boston and Richmond noted a slightly slower pace of growth. Most Districts were optimistic about the outlook for growth.

And on real estate:

Residential real estate activity continued to vary by Federal Reserve District, reflecting generally low inventories and mixed levels of demand. ...

Residential construction activity generally increased across the Districts, with only St. Louis and Minneapolis reporting a decline in overall activity. ...

Commercial construction activity strengthened across most Districts. Cleveland and Atlanta reported increased commercial construction activity compared to a year ago, and Philadelphia, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco noted gains since the previous survey period. Boston and Richmond saw mixed commercial construction activity across their Districts since the previous report. Dallas indicated strong overall commercial real estate construction activity, and commercial real estate construction increased in the Minneapolis District compared with the previous report. Boston, New York, Richmond, Chicago, Kansas City, and Dallas reported tight commercial vacancy rates. Industrial real estate construction and leasing activity was strong in the Philadelphia and Chicago Districts.
emphasis added

Somewhat positive comments on both residential and non-residential real estate.