by Calculated Risk on 12/16/2010 02:29:00 PM

A weekly update on hotels from HotelNewsNow.com: STR: San Francisco tops weekly increases

Overall, the industry’s occupancy increased 8.6% to 52.2%, ADR was up 2.6% to US$98.75, and RevPAR ended the week up 11.5% to US$51.56.

The following graph shows the four week moving average for the occupancy rate by week for 2008, 2009 and 2010 (and a median for 2000 through 2007).

Click on graph for larger image in new window.

Notes: the scale doesn't start at zero to better show the change. The graph shows the 4-week average, not the weekly occupancy rate.

On a 4-week basis, occupancy is up 7.2% compared to last year and 2.6% below the median for 2000 through 2007.

This is the slow season for hotels, and the key will be if business travel picks up early next year.

Note: RevPAR (revenue per available room) was up 2.7% compared to the same week two years ago (in 2008) for the second time this year.

Data Source: Smith Travel Research, Courtesy of HotelNewsNow.com

by Calculated Risk on 12/16/2010 11:17:00 AM

Notes: CoreLogic reports the year-over-year change. The headline for this post is for the change from September to October 2010. The CoreLogic HPI is a three month weighted average of August, September and October, and is not seasonally adjusted (NSA).

From CoreLogic: Home Price Index Shows Decline for Third Straight Month, October Home Prices Declined 3.93 Percent Year Over Year

CoreLogic ... today released today released its October Home Price Index (HPI) which shows that home prices in the U.S. declined for the third month in a row. According to the CoreLogic HPI, national home prices, including distressed sales, declined by 3.93 percent in October 2010 compared to October 2009 and declined by 2.43 percent* in September 2010 compared to September 2009. Excluding distressed sales, year-over-year prices declined by 1.5 percent in October 2010 compared to October 2009. ...

“We are continuing to see the weakness in home prices without artificial government support in the form of tax credits. The stubborn unemployment levels and seasonality are also coming into play,” said Mark Fleming, chief economist for CoreLogic. “When you combine these factors with high shadow and visible inventories, the prospect for a housing recovery in early 2011 is fading.”

Click on graph for larger image in graph gallery.

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

The index is down 3.93% over the last year, and off 30.2% from the peak.

The index is 2.2% above the low set in March 2009, and I expect to see a new post-bubble low for this index - possibly as early as next month or maybe in early 2011.

by Calculated Risk on 12/16/2010 08:57:00 AM

Click on graph for larger image in new window.

Total housing starts were at 555 thousand (SAAR) in November, up 3.9% from the revised October rate of 534 thousand, and up 16% from the all time record low in April 2009 of 477 thousand (the lowest level since the Census Bureau began tracking housing starts in 1959).

The increase this month was due to single-family starts, but the level is still very low. Single-family starts increased 6.9% to 465 thousand in November.

The second graph shows total and single unit starts since 1968. This shows the huge collapse following the housing bubble, and that housing starts have mostly been moving sideways for two years - with a slight up and down over the last six months due to the home buyer tax credit.

Here is the Census Bureau report on housing Permits, Starts and Completions.

Housing Starts:
Privately-owned housing starts in November were at a seasonally adjusted annual rate of 555,000. This is 3.9 percent (±12.0%)* above the revised October estimate of 534,000, but is 5.8 percent (±12.0%)* below the November 2009 rate of 589,000.

Single-family housing starts in November were at a rate of 465,000; this is 6.9 percent (±13.5%)* above the revised October figure of 435,000.

Building Permits:
Privately-owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 530,000. This is 4.0 percent (±2.9%) below the revised October rate of 552,000 and is 14.7 percent(±1.7%) below the November 2009 estimate of 621,000.

Single-family authorizations in November were at a rate of 416,000; this is 3.0 percent (±1.0%) above the revised October figure of 404,000.

This was close to expectations of 550 thousand starts. The low level of starts is good news for housing, and I expect Starts to stay low until more of the excess inventory of existing homes is absorbed.

by Calculated Risk on 12/16/2010 08:30:00 AM

The DOL reports on weekly unemployment insurance claims:

In the week ending Dec. 11, the advance figure for seasonally adjusted initial claims was 420,000, a decrease of 3,000 from the previous week's revised figure of 423,000. The 4-week moving average was 422,750, a decrease of 5,250 from the previous week's revised average of 428,000.

Click on graph for larger image in new window.

This graph shows the 4-week moving average of weekly claims since January 2000.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased this week by 5,250 to 422,750.

This is the lowest level for the 4-week moving average since the first week in August 2008. The level is still high, but the decline in the 4-week average is good news.

by Calculated Risk on 12/15/2010 11:59:00 PM

The slow motion train wreck continues in Europe.

From the NY Times: Europe Staggers as Critical Summit Looms

Europe’s smoldering financial crisis flared up on Wednesday, with riots over austerity spending in Greece, new signs of troubles in Spain and little indication that European leaders were moving any closer to agreement on a systemic approach to long-term stability.

The day’s events emphasized the complex social, political and economic challenges facing government leaders at a European Union summit meeting on Thursday and Friday in Brussels.

And from the Financial Times: German MPs clash on future of eurozone

The question is when the crisis will flare up again - and where (Spain?)

Earlier today:
• Mortgage Applications decline, Mortgage rates rise sharply
• The Empire State Manufacturing Survey showed expansion
• Industrial Production, Capacity Utilization increased in November
• NAHB Builder Confidence Flat in December
• Tax Legislation Passes in Senate 81 to 19
• Inflation: Core CPI, Median CPI, 16% trimmed-mean CPI remain below 1% YoY

Thursday:
• 8:30 AM: The initial weekly unemployment claims report will be released.
• 8:30 AM: Housing Starts for November.

Best to all

by Calculated Risk on 12/15/2010 07:17:00 PM

From DataQuick: Southland Home Sales Dip; Prices Change Little

Southern California home sales fell in November to the second-lowest level for that month in 18 years, reflecting the weak economic recovery, a dormant new-home market and tight credit conditions. ...

A total of 16,208 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month. That was down 3.2 percent from 16,744 sales in October, and down 15.5 percent from 19,181 in November 2009, according to MDA DataQuick of San Diego.
...
In the new-home market, sales were the slowest for a November since at least 1988. In many growth areas the math for builders just doesn’t work: The cost to construct is higher than what buyers can afford or are willing to pay. Often builders can’t compete with the pricing of nearby resale homes, especially foreclosures and short sales.

The last comment on the new-home market is one of the reasons I track the "distressing gap" (the change in the ratio between new and existing home sales). In most areas the builders just can't compete with distressed sales - although in some areas they are competing by building much smaller homes.

This report is consistent with Tom Lawler's initial read of 4.57 million existing home sales in November (seasonally adjusted annual rate).