by Calculated Risk on 5/28/2015 01:02:00 PM

Freddie Mac reported that the Single-Family serious delinquency rate declined in April to 1.66%, down from 1.73% in March. Freddie's rate is down from 2.15% in April 2014, and the rate in March was the lowest level since November 2008.

Freddie's serious delinquency rate peaked in February 2010 at 4.20%.

These are mortgage loans that are "three monthly payments or more past due or in foreclosure". 

Note: Fannie Mae will report their Single-Family Serious Delinquency rate for April in a few days.

Click on graph for larger image

Although the rate is declining, the "normal" serious delinquency rate is under 1%. 

The serious delinquency rate has fallen 0.49 percentage points over the last year, and at that rate of improvement, the serious delinquency rate will not be below 1% until late 2016.

So even though delinquencies and distressed sales are declining, I expect an above normal level of Fannie and Freddie distressed sales through 2016 (mostly in judicial foreclosure states).

by Calculated Risk on 5/28/2015 10:02:00 AM

From the NAR: Pending Home Sales Climb in April to Highest Level since May 2006

Pending home sales rose in April for the fourth straight month and reached their highest level in nine years, according to the National Association of Realtors®. Led by the Northeast and Midwest, all four major regions saw increases in April.

The Pending Home Sales Index, a forward-looking indicator based on contract signings, increased 3.4 percent to 112.4 in April from a slight upward revision of 108.7 in March and is now 14.0 percent above April 2014 (98.6) — the largest annual increase since September 2012 (15.1 percent). The index has now increased year-over-year for eight consecutive months and is at its highest level since May 2006 (112.5).

This was abpve expectations of a 0.8% increase.

Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in May and June.

by Calculated Risk on 5/28/2015 08:34:00 AM

The DOL reported:

In the week ending May 23, the advance figure for seasonally adjusted initial claims was 282,000, an increase of 7,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 274,000 to 275,000. The 4-week moving average was 271,500, an increase of 5,000 from the previous week's revised average. The previous week's average was revised up by 250 from 266,250 to 266,500.

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

The previous week was revised to 275,000.

The following graph shows the 4-week moving average of weekly claims since 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 increased to 271,500.

This was above the consensus forecast of 270,000, and the low level of the 4-week average suggests few layoffs.

by Calculated Risk on 5/27/2015 08:06:00 PM

From Reuters: EU officials dismiss Greek statement on aid agreement being drafted

Greece's government on Wednesday said it is starting to draft an agreement with creditors that would pave the way for aid, but European officials quickly dismissed that as wishful thinking.
...
But European Commission Vice President Valdis Dombrovskis said the two sides still had some way to go before any agreement could be drawn up.

"We are working very intensively to ensure a staff-level agreement," he said. "We are still not there yet."

Other officials in the euro zone, speaking to Reuters on condition of anonymity, were more blunt. One called the Greek remarks "nonsense". Another said: "I wish it were true."

Thursday:
• At 8:30 AM ET, the initial weekly unemployment claims report will be released. The consensus is for claims to decrease to 270 thousand from 274 thousand.

• At 10:00 AM, the Pending Home Sales Index for April. The consensus is for a 0.8% increase in the index.

by Calculated Risk on 5/27/2015 03:22:00 PM

The Case-Shiller house price indexes for March were released this yesterday. Zillow forecasts Case-Shiller a month early, and I like to check the Zillow forecasts since they have been pretty close.

From Zillow: Expect More of the Same from Case-Shiller in April

The March S&P/Case-Shiller (SPCS) data published [yesterday] showed home prices continuing to appreciate at around 5 percent annually for both the 10- and 20- City Indices, and roughly 4 percent for the national index. March marks the seventh consecutive month in which the national home price index has appreciated at a less than 5 percent annual appreciation rate (seasonally adjusted).

In March, the 10-City Index appreciated at an annual rate of 4.7 percent, compared to 5.0 percent for the 20-City Index (SA). The non-seasonally adjusted (NSA) 10-City Index was up 0.8 percent month-over-month, while the 20-City index rose 0.9 percent (NSA) from February to March. We expect the change from March to April to show increases of more than 1 percent (NSA) for both the 10- and 20- City Indices.

All forecasts are shown in the table below. These forecasts are based on the March SPCS data release and the April 2015 Zillow Home Value Index (ZHVI), published May 21. Officially, the SPCS Composite Home Price Indices for March will not be released until Tuesday, June 30.

So the year-over-year change in for April Case-Shiller National index will be about the same as in the March report.

Zillow Case-Shiller Forecast
	Case-Shiller Composite 10		Case-Shiller Composite 20		Case-Shiller National
	NSA	SA	NSA	SA	NSA	SA
March Actual YoY	4.7%	4.7%	5.0%	5.0%	4.1%	4.1%
April Forecast YoY	4.9%	4.9%	5.2%	5.2%	4.0%	4.0%
April Forecast MoM	1.2%	0.5%	1.3%	0.6%	1.0%	0.0%

From Zillow:

Annual appreciation in the Zillow Home Value Index (ZHVI) peaked in April 2014 and has declined since then. In April, the U.S. ZHVI rose 3 percent year-over-year, one percentage point lower than the annual change in rents (4 percent). The April Zillow Home Value Forecast calls for a 2 percent rise in home values through April 2016. Further details on our forecast of home values can be found here.