by Calculated Risk on 11/25/2014 11:00:00 AM

Here is the Q3 report: Household Debt and Credit Report. From the NY Fed:

Aggregate household debt balances increased slightly in the 3rd quarter of 2014. As of September 30, 2014, total household indebtedness was $11.71 trillion, up by 0.7% from its level in the second quarter of 2014, an increase of $78 billion. Overall household debt still remains 7.6% below its 2008Q3 peak of $12.68 trillion.

Mortgages, the largest component of household debt, edged up by 0.4%. Mortgage balances shown on consumer credit reports stand at $8.13 trillion, up by $35 billion from their level in the second quarter. Balances on home equity lines of credit (HELOC) dropped by $9 billion (1.7%) in the third quarter and now stand at $512 billion. Non-housing debt balances increased by 1.7 %, boosted by gains in all categories. Auto loan balances increased by $29 billion; student loan balances increased by $8 billion; credit card balances increased by $11 billion.

New extensions increased for auto loans and credit cards, but were roughly flat for both mortgages and HELOCs. There were $105 billion in new auto loan originations, the highest volume since 2005Q3. The aggregate credit card limit continued to increase, and is up by 0.9% from the previous quarter. Mortgage originations, which we measure as appearances of new mortgage balances on consumer credit reports and which include refinanced mortgages, increased slightly to $337 billion but remain low by historical standards. HELOC limits were flat, down by 0.4%.

Overall delinquency rates were flat overall in 2014Q3 As of September 30, 6.3% of outstanding debt was in some stage of delinquency, compared with 6.2% in 2014Q2. About $732 billion of debt is delinquent, with $506 billion seriously delinquent (at least 90 days late or “severely derogatory”).
emphasis added

Click on graph for larger image.

Here are two graphs from the report:

The first graph shows aggregate consumer debt increased slightly in Q3.  Household debt peaked in 2008, and bottomed in Q2 2013.

The recent increase in debt suggests households (in the aggregate)  deleveraging is over.  Also from the NY Fed: Household Debt Balances Increase as Deleveraging Period Concludes

Total cash flow from mortgage debt and nonmortgage debt combined (black dotted line) has turned slightly positive during the past four quarters, ending a five-year period of negative values, suggesting that, by this measure, the deleveraging process has ended; households have begun to use credit to supplement their cash flow again.

The second graph shows the percent of debt in delinquency. The percent of delinquent debt is generally declining, although there is still a large percent of debt 90+ days delinquent (Yellow, orange and red). 

The overall delinquency rate increased slightly to 6.3% in Q3, from 6.2% in Q2.   However the slight increase was in the less than 30 day category, and is not a concern.

The Severely Derogatory (red) rate has fallen to 2.18%, the lowest since Q1 2008.

The 120+ days late (orange) rate has declined to 1.82%, the lowest since Q2 2008.

Short term delinquencies are back to normal levels.

Here is the press release from the NY Fed: New York Fed Report Shows Household Debt Edges Higher

There are a number of credit graphs at the NY Fed site.

by Calculated Risk on 11/25/2014 09:14:00 AM

S&P/Case-Shiller released the monthly Home Price Indices for September ("September" is a 3 month average of July, August and September prices).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.

Note: Case-Shiller reports Not Seasonally Adjusted (NSA), I use the SA data for the graphs.

From S&P: Broad-based Slowdown for Home Prices According to the S&P/Case-Shiller Home Price Indices

S&P Dow Jones Indices today released the September 2014 index data for the S&P/Case-Shiller Home Price Indices ... Results show that home prices continue to decelerate. The 10-City Composite gained 4.8% year-over-year, down from 5.5% in August. The 20-City Composite gained 4.9% year-over-year, compared to 5.6% in August.

The National and Composite Indices were both slightly negative in September. Both the 10 and 20-City Composites reported a slight downturn while the National Index posted a -0.1% change for the month. Charlotte and Miami led all cities in September with increases of 0.6%. Atlanta and Washington D.C. offset those gains by reporting decreases of 0.3% and 0.4%. ...

The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded a 4.8% annual gain in September 2014. The 10- and 20-City Composites reported year-over-year increases of 4.8% and 4.9%.

Click on graph for larger image.

The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).

The Composite 10 index is off 18.5% from the peak, and up 0.3% in September (SA). The Composite 10 is up 23.3% from the post bubble low set in Jan 2012 (SA).

The Composite 20 index is off 17.6% from the peak, and up 0.3% (SA) in September. The Composite 20 is up 24.2% from the post-bubble low set in Jan 2012 (SA).

The National index is off 10.4% from the peak, and up 0.7% (SA) in September.  The National index is up 21.0% from the post-bubble low set in Dec 2012 (SA).

The second graph shows the Year over year change in all three indices.

The Composite 10 SA is up 4.9% compared to September 2013.

The Composite 20 SA is up 4.9% compared to September 2013.

The National index SA is up 4.8% compared to September 2013.

Prices increased (SA) in 16 of the 20 Case-Shiller cities in September seasonally adjusted.  (Prices increased in 9 of the 20 cities NSA)  Prices in Las Vegas are off 42.3% from the peak, and prices in Denver and Dallas are at new highs (SA).

This was above than the consensus forecast for a 4.5% YoY increase for the National index, and suggests a further slowdown in price increases. I'll have more on house prices later.

by Calculated Risk on 11/25/2014 08:36:00 AM

From the BEA: Gross Domestic Product: Third Quarter 2014 (Second Estimate)

Real gross domestic product -- the value of the production of goods and services in the United States, adjusted for price changes -- increased at an annual rate of 3.9 percent in the third quarter of 2014, according to the "second" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 4.6 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the increase in real GDP was 3.5 percent. With the second estimate for the third quarter, private inventory investment decreased less than previously estimated, and both personal consumption expenditures (PCE) and nonresidential fixed investment increased more. In contrast, exports increased less than previously estimated.

The increase in real GDP in the third quarter reflected positive contributions from PCE, nonresidential fixed investment, federal government spending, exports, residential fixed investment, and state and local government spending that were partly offset by a negative contribution from private inventory investment. Imports, which are a subtraction in the calculation of GDP, decreased.

Here is a Comparison of Second and Advance Estimates.  PCE was revised up from 1.8% to 2.2%, and private investment was revised up.   A solid report.

by Calculated Risk on 11/24/2014 08:11:00 PM

There has been little precipitation in California so far this year - following three years of drought - from the NY Times: As Snow Fades, California Ski Resorts Are Left High and Very Dry

The season is just starting, and snow may yet pile high, but the harvest in California the last three years was bleak, and the globe’s long-range forecast is grim.

Last year’s snow pack at the University of California, Berkeley’s Central Sierra Snow Lab, in the heart of California ski country near Lake Tahoe, topped out at a depth of 133 centimeters (about 52 inches), the second lowest of the last 90 years. With most of the snow arriving late in the season, skier and snowboarder visits in this area were down by 25 percent from the season before, according to the National Ski Area Association.

Similarly meager snow packs in 2012 and 2013 have exacerbated the statewide drought, with ramifications far beyond the ski industry. A fourth lackluster season would be unprecedented, according to snow records kept since 1879.

The article is about ski resorts, but the main impact of another year of drought will be on agriculture and food prices (California is by far the largest agricultural producing State).

Tuesday:
• At 8:30 AM ET, Gross Domestic Product, 3rd quarter 2014 (second estimate); Corporate Profits, 3rd quarter 2014 (preliminary estimate). The consensus is that real GDP increased 3.3% annualized in Q3, revised down from the advance estimate of 3.5%.

• At 9:00 AM, the FHFA House Price Index for September 2013. This was original a GSE only repeat sales, however there is also an expanded index. The consensus is for a 0.4% increase.

• Also at 9:00 AM, the S&P/Case-Shiller House Price Index for September. Although this is the September report, it is really a 3 month average of July, August and September prices. The consensus is for a 4.5% year-over-year increase in the National Index for September, down from 5.1% in August (consensus 4.8% increase in Comp 20). The Zillow forecast is for the Composite 20 to increase 4.7% year-over-year in September, and for prices to increase 0.1% month-to-month seasonally adjusted.

• At 10:00 AM, the Richmond Fed Survey of Manufacturing Activity for November. This is the last of the regional Fed surveys for November.

• Also at 10:00 AM, the Conference Board's consumer confidence index for November. The consensus is for the index to increase to 95.7 from 94.5.

• At 11:00 AM, the NY Fed Q3 2014 Household Debt and Credit Report. The New York Fed will also release an accompanying blog, which will analyze household deleveraging.

by Calculated Risk on 11/24/2014 05:35:00 PM

From Matthew Graham at Mortgage News Daily: Mortgage Rates Now at 1-Month Lows

Mortgage rates continue making improvements so small and so steady that they're barely noticeable, but they're improvements just the same. That's recently left us in the best territory in nearly a month. Today extends those slow and steady gains just enough to technically claim the "1-month low" designation, despite the fact that rates aren't materially different than they have been. The most prevalently-quoted conforming 30yr fixed rate remains 4.0% for top tier borrowers, but each day of modest improvement brings us closer to 3.875% and puts 4.125% farther in the rearview

Here is a table from Mortgage News Daily:

Home Loan Rates

View More Refinance Rates