by Calculated Risk on 7/17/2015 10:08:00 AM

The preliminary University of Michigan consumer sentiment index for July was at 93.3, down from 96.1 in June.

This was below the consensus forecast of 96.2.


Click on graph for larger image.

by Calculated Risk on 7/17/2015 08:39:00 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 1,174,000. This is 9.8 percent above the revised May estimate of 1,069,000 and is 26.6 percent above the June 2014 rate of 927,000.

Single-family housing starts in June were at a rate of 685,000; this is 0.9 percent below the revised May figure of 691,000. The June rate for units in buildings with five units or more was 476,000.

Building Permits:
Privately-owned housing units authorized by building permits in June were at a seasonally adjusted annual rate of 1,343,000. This is 7.4 percent above the revised May rate of 1,250,000 and is 30.0 percent above the June 2014 estimate of 1,033,000.

Single-family authorizations in June were at a rate of 687,000; this is 0.9 percent above the revised May figure of 681,000. Authorizations of units in buildings with five units or more were at a rate of 621,000 in June.
emphasis added

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) increased in June.  Multi-family starts are up sharply year-over-year.

Single-family starts (blue)  decreased in June (because May was revised up) and are up about 14.7% year-over-year.

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

 The second graph shows the huge collapse following the housing bubble, and then - after moving sideways for a couple of years - housing is now recovering (but still historically low),

This was above expectations of 1.125 million starts in June.  And, with the upward revisions to prior months, and another surge in permits, this was another solid report. I'll have more later ...

by Calculated Risk on 7/16/2015 07:52:00 PM

Excerpts from a research piece by Goldman Sachs economist Zach Pandl on GDP:

Although most of the inputs used to calculate GDP are seasonally adjusted, the topline growth numbers still appear to fluctuate with seasonal patterns. The BEA intends to address this “residual seasonality” as part of its annual GDP revisions later this month. While the new estimates will be an improvement, they look unlikely to remove residual seasonality altogether.

According to our estimates, reported GDP growth tends to run about 1pp below other measures of real activity (like GDI or our CAI) in Q1 of each year. These estimates are statistically significant across a variety of samples. The BEA has said it will revise several components of GDP, rather than address residual seasonality at the aggregate level. We estimate that the likely revisions will affect Q3 and Q4 the most, with only modest effects on Q1 of about 0.3pp. Thus, our preliminary estimates suggest that Q1 GDP figures will remain about 0.7pp too low.

Residual seasonality is just one reason we track other measures of growth in conjunction with GDP. The BEA also seems to see the value in this approach, and with the revision will begin publishing other aggregate measures to “facilitate the analysis of macroeconomics trends”.

Friday:
• At 8:30 AM ET, the Consumer Price Index for June from the BLS. The consensus is for a 0.3% increase in prices, and a 0.2% increase in core CPI.

• Also at 8:30 AM, Housing Starts for June. Total housing starts decreased to 1.036 million (SAAR) in May. Single family starts decreased to 680 thousand SAAR in May. The consensus is for total housing starts to increase to 1.125 million (SAAR) in June.

• At 10:00 AM, the University of Michigan's Consumer sentiment index (preliminary for July). The consensus is for a reading of 96.2, up from 96.1 in June.

by Calculated Risk on 7/16/2015 05:01:00 PM

Economist Tom Lawler sent me a preliminary table below of short sales, foreclosures and cash buyers for a few selected cities in June.

On distressed: Total "distressed" share is down in most of these markets mostly due to a decline in short sales (Baltimore is up because of an increase in foreclosures).

Short sales are down in all of these areas.

The All Cash Share (last two columns) is declining year-over-year. As investors pull back, the share of all cash buyers will probably continue to decline.

As Lawler noted before: The Baltimore Metro area is included in the overall Mid-Atlantic region (covered by MRIS). Baltimore is also shown separately because a large portion of the YOY increase in the foreclosure share of home sales in the Mid-Atlantic region was attributable to the significant increase in foreclosure sales in the Baltimore Metro area.

	Short Sales Share		Foreclosure Sales Share		Total "Distressed" Share		All Cash Share
	Jun- 2015	Jun- 2014	Jun- 2015	Jun- 2014	Jun- 2015	Jun- 2014	Jun- 2015	Jun- 2014
Las Vegas	6.7%	10.8%	7.6%	10.1%	14.3%	20.9%	28.4%	34.7%
Reno**	5.0%	10.0%	3.0%	7.0%	8.0%	17.0%
Phoenix							23.0%	26.6%
Sacramento	5.8%	7.0%	4.6%	6.5%	10.4%	13.6%	17.8%	19.8%
Minneapolis	2.0%	3.0%	5.6%	9.7%	7.6%	12.7%
Mid-Atlantic	3.1%	4.8%	8.7%	7.4%	11.7%	12.2%	15.2%	16.5%
Baltimore MSA****	3.1%	4.3%	14.3%	10.7%	17.4%	15.0%	20.7%	19.8%
Orlando	3.7%	7.8%	24.9%	26.5%	28.6%	34.3%	35.7%	40.5%
Chicago (city)					12.4%	18.7%
Hampton Roads					16.6%	20.1%
Spokane					10.7%	14.1%
Northeast Florida					25.6%	32.4%
Toledo							27.0%	28.4%
Wichita							21.9%	22.6%
Des Moines							14.4%	14.6%
Tucson							25.1%	26.1%
Georgia***							20.3%	24.6%
Omaha							14.6%	16.3%
Richmond VA MSA			7.1%	9.7%			13.8%	16.1%
Memphis			11.4%	12.4%
Springfield IL**			5.1%	8.4%
*share of existing home sales, based on property records **Single Family Only ***GAMLS ****Baltimore is included in the Mid-Atlantic region, but is shown separately here

by Calculated Risk on 7/16/2015 02:05:00 PM

From housing economist Tom Lawler:

Based on reports released by various realtor associations/MLS from across the country, I predict that existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 5.45 million in June, up 1.9% from May’s pace, and up 8.8% from last June’s seasonally adjusted pace. Unadjusted home sales should an even larger YOY increase, reflecting the higher business day count this June compared to last June.

Realtor/MLS data suggest that the inventory of existing homes for sale as estimated by the NAR should be about 2.33 million at the end of June, up 1.7% from May and up 1.7% from a year earlier.

And finally, realtor/MLS data are consistent with a year-over-year increase in the median existing single-family home sales price of about 6.5%.

CR Note: The sales rate in June will likely be the highest since early 2007.