by Calculated Risk on 3/11/2015 10:43:00 AM

Each month I track sales and inventory data for several previous bubble areas (like Las Vegas, Phoenix, Sacramento). These areas are interesting because they had huge prices bubbles, and large price declines - followed by significant investor buying (that is now declining).  I also track these areas because the data is available on line.

Housing economist Tom Lawler is tracking a number of other areas, and has been kind enough to share that data with us (focused on distressed sales and cash buying).

If you are looking for data on your own area, you could try the local MLS, or look at the Zillow Research data. In addition to prices, Zillow tracks inventory and sales by metro area and zip code.  Scroll down to "Other Metrics" and look at "Home Sales" and "For-sale Inventory" for the last five years.

Caution: Zillow has been expanding their coverage, so use caution when creating a data series based on aggregate data.

by Calculated Risk on 3/11/2015 07:01:00 AM

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 1.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 6, 2015. ...

The Refinance Index decreased 3 percent from the previous week to the lowest level since January 2015. The seasonally adjusted Purchase Index increased 2 percent from one week earlier.
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.01 percent, the highest level since the week ending January 2, 2015, from 3.96 percent, with points increasing to 0.39 from 0.30 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.


The first graph shows the refinance index.

2014 was the lowest year for refinance activity since year 2000.

2015 will probably see a little more refinance activity than in 2014, but not a large refinance boom.

The second graph shows the MBA mortgage purchase index.  

According to the MBA, the unadjusted purchase index is 2% higher than a year ago.

by Calculated Risk on 3/10/2015 07:39:00 PM

From Jon Hilsenrath at the WSJ: Fed Leans Toward Removing ‘Patient’ Promise on Rates

The Federal Reserve is strongly considering removing a barrier to raising short-term interest rates, by dropping its promise to be “patient” before acting.
...
Dropping the patience promise next week doesn’t mean officials are yet set on a rate increase in June. Ms. Yellen has signaled that the inflation backdrop is the key wildcard in the months ahead. Though the job market is improving as the Fed hoped, inflation isn’t moving back toward its 2% objective.

It seems very likely that "patient" will be removed from the statement. This will mean a June rate hike is possible, but not guaranteed.

Wednesday:
• 7:00 AM ET, the Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

• At 10:00 AM, the Q4 Quarterly Services Report from the Census Bureau.

• At 4:30 PM, the Federal Reserve will release the Comprehensive Capital Analysis and Review Results (Stress Test)

by Calculated Risk on 3/10/2015 04:45:00 PM

For the third consecutive month, inventory was down year-over-year in Phoenix.  This is a significant change.

This is a key distressed market to follow since Phoenix saw a large bubble / bust followed by strong investor buying.  These key markets hopefully show us changes in trends for sales and inventory.

The Arizona Regional Multiple Listing Service (ARMLS) reports (table below):

1) Overall sales in January were up 9.0% year-over-year.  Another change.

2) Cash Sales (frequently investors) were down about 8% to 29.9% of total sales. Non-cash sales were up 18.3% year-over-year.

3) Active inventory is now down 8.4% year-over-year.   Note: House prices bottomed in Phoenix in 2011 at about the current level of inventory.

More inventory (a theme in 2014) - and less investor buying - suggested price increases would slow sharply in 2014.  And prices increases did slow.

Now, with falling inventory, prices might increase a little faster in 2015 (something to watch if inventory continues to decline).

February Residential Sales and Inventory, Greater Phoenix Area, ARMLS
	Sales	YoY Change Sales	Cash Sales	Percent Cash	Active Inventory	YoY Change Inventory
Feb-2008	3,445	---	650	18.9%	57,3051	---
Feb-2009	5,477	59.0%	2,188	39.9%	52,013	-9.2%
Feb-2010	6,595	20.4%	2,997	45.4%	42,388	-18.5%
Feb-2011	7,171	8.7%	3,776	52.7%	40,666	-4.1%
Feb-2012	7,249	1.1%	3,616	49.9%	23,736	-41.6%
Feb-2013	6,618	-8.7%	3,053	46.1%	21,718	-8.5%
Feb-2014	5,476	-17.3%	1,939	35.4%	29,899	37.7%
Feb-2015	5,970	9.0%	1,784	29.9%	27,382	-8.4%
1 February 2008 probably included pending listings

by Calculated Risk on 3/10/2015 01:38:00 PM

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

FNC released their January 2015 index data today.  FNC reported that their Residential Price Index™ (RPI) indicates that U.S. residential property values decreased 0.3% from December to January (Composite 100 index, not seasonally adjusted). 

The 10 city MSA, the 20-MSA and 30-MSA RPIs all decreased . These indexes are not seasonally adjusted (NSA), and are for non-distressed home sales (excluding foreclosure auction sales, REO sales, and short sales).

Notes: In addition to the composite indexes, FNC presents price indexes for 30 MSAs. FNC also provides seasonally adjusted data.

The year-over-year (YoY) change was lower in January than in December, with the 100-MSA composite up 4.3% compared to January 2014  (this index was up 5.0% year-over-year in December).   In general, for FNC, the YoY increase has been slowing since peaking in March at 9.0%.

The index is still down 19.8% from the peak in 2006.

Click on graph for larger image.

This graph shows the year-over-year change based on the FNC index (four composites) through January 2015. The FNC indexes are hedonic price indexes using a blend of sold homes and real-time appraisals.

Most of the price indexes have been showing a slowdown in price increases.

Note: The January Case-Shiller index will be released on Tuesday, Tuesday, March 31.