by Calculated Risk on 4/06/2021 12:37:00 PM

This report is for closed sales in March; sales are counted at the close of escrow, so the contracts for these homes were mostly signed in January and February.

The Las Vegas Realtors reported Southern Nevada home prices keep springing forward amid tight supply; LVR housing statistics for March 2021

"This is the first month where our housing statistics show a year-over-year comparison to the beginning of the pandemic,” said 2021 LVR President Aldo Martinez. “At the rate we’re going, we could see even greater gains in home prices and sales next month, since the housing market stalled briefly last April before roaring back since then.”

LVR reported a total of 4,724 existing local homes, condos and townhomes were sold during March. Compared to the same time last year, March sales were up 35.1% for homes and up 39.8% for condos and townhomes.
…
By the end of March, LVR reported 1,772 single-family homes listed for sale without any sort of offer. While up from the previous month, that’s still down 68.8% from one year ago. For condos and townhomes, the 597 properties listed without offers in March represent a 63.3% drop from one year ago.
...
Despite the ongoing pandemic and accompanying economic downturn, the number of so-called distressed sales remains near historically low levels. LVR reported that short sales and foreclosures combined accounted for just 0.6% of all existing local property sales in March. That compares to 2.0% of all sales one year ago, 2.5% of all sales two years ago, 2.9% three years ago, and 9.8% four years ago.
emphasis added

1) Overall sales (single family and condos) were up 36.1% year-over-year to 4,724 in March 2021 from 7,315 in March 2020.

2) Active inventory (single-family and condos) is down from a year ago, from a total of 5,454 in March 2020 to 2,369 in March 2021. Note: Total inventory was down 67.6% year-over-year.   And months of inventory is extremely low.

3) Very low level of distressed sales.

by Calculated Risk on 4/06/2021 10:06:00 AM

From the BLS: Job Openings and Labor Turnover Summary

The number of job openings edged up to 7.4 million on the last business day of February, the U.S. Bureau of Labor Statistics reported today. Hires also edged up to 5.7 million while total separations were little changed at 5.5 million. Within separations, the quits rate and layoffs and discharges rate were unchanged at 2.3 percent and 1.2 percent, respectively.
emphasis added

The following graph shows job openings (yellow line), hires (dark blue), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.

This series started in December 2000.

Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for February, the most recent employment report was for March.

Click on graph for larger image.

Note that hires (dark blue) and total separations (red and light blue columns stacked) are usually pretty close each month. This is a measure of labor market turnover.  When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs.

The huge spikes in layoffs and discharges in March and April 2020 are labeled, but off the chart to better show the usual data.

Jobs openings increased in February to 7.367 million from 7.099 million in January.  This is close to the series maximum of 7.574 million.

The number of job openings (yellow) were up 5.1% year-over-year.  Note that job openings were declining a year ago prior to the pandemic.

Quits were down 2.1% year-over-year. These are voluntary separations. (see light blue columns at bottom of graph for trend for "quits").

by Calculated Risk on 4/06/2021 08:00:00 AM

Notes: This CoreLogic House Price Index report is for February. The recent Case-Shiller index release was for January. The CoreLogic HPI is a three month weighted average and is not seasonally adjusted (NSA).

From CoreLogic: Market Forces at Work: Supply Constraints and Buyer Demand Pushes US Home Price Annual Appreciation to 15-Year High in February, CoreLogic Reports

CoreLogic® ... today released the CoreLogic Home Price Index (HPI™) and HPI Forecast™ for February 2021.

Home prices continued to increase in February, reaching the highest annual gain since April 2006, as demand continues to clash with historically low supply. These factors have created increased affordability challenges, especially as mortgage rates also begin to rise.

CoreLogic analysis also shows homebuyers have steadily moved away from densely populated, high-cost coastal areas in favor of more affordable suburban locales. The number of homebuyers in the top 10 metros with the largest net out-migration — including West Coast metros like Los Angeles, San Francisco and San Jose — who chose to move to another metro increased by 3 percentage points in 2020 to 21% from 2019. This sentiment is reflected in CoreLogic’s recent consumer survey, which found that 57% of current non-homeowners on the West Coast feel the home options in their area are not at all affordable.

“Homebuyers are experiencing the most competitive housing market we’ve seen since the Great Recession,” said Frank Martell, president and CEO of CoreLogic. “Rising mortgage rates and severe supply constraints are pushing already-overheated home prices out of reach for some prospective buyers, especially in more expensive metro areas. As affordability challenges persist, we may see more potential homebuyers priced out of the market and a possible slowing of price growth on the horizon.”
...
Nationally, home prices increased 10.4% in February 2021, compared with February 2020. On a month-over-month basis, home prices increased by 1.2% compared to January 2021.

“The run-up in home prices is good news for current homeowners but sobering for prospective buyers,” said Dr. Frank Nothaft, chief economist at CoreLogic. “Those looking to buy need to save for a down payment, closing costs and cash reserves, all of which are much higher as home prices go up. Add to that a rise in mortgage rates and the affordability challenge for first-time buyers becomes even greater."
emphasis added

by Calculated Risk on 4/05/2021 09:00:00 PM

From Matthew Graham at Mortgage News Daily: MBS RECAP: Decent Showing For Bonds Despite Strong Data

The rising rate trend of 2021 is increasingly being called into question--even if only temporarily--due to the inability of 10yr yields to quickly break above 1.75%. That said, at levels of 1.72-1.74% so far this morning, it's definitely not time to celebrate just yet. ... [30 year fixed 3.38%]
emphasis added

Tuesday:
• At 8:00 AM ET, Corelogic House Price index for February.

• At 10:00 AM, Job Openings and Labor Turnover Survey for February from the BLS.

by Calculated Risk on 4/05/2021 06:01:00 PM

Note: I've been posting this data daily for over a year. I'll stop once all three of these criteria are met:
1) 70% of the population over 18 has had at least one dose of vaccine,
2) new cases are under 5,000 per day, and
3) hospitalizations are below 3,000.

According to the CDC, 167.2 million doses have been administered. 23.2% of the population over 18 is fully vaccinated, and 40.2% of the population over 18 has had at least one dose (103.7 million people have had at least one dose).

And check out COVID Act Now to see how each state is doing. 

Over 3,000 US deaths were reported so far in April due to COVID.

Click on graph for larger image.

This graph shows the daily (columns) 7 day average (line) of positive tests reported.

Note: The ups and downs during the Winter surge were related to reporting delays due to the Thanksgiving and Christmas holidays.

This data is from the CDC.

The 7-day average is 63,065, down from 64,001 yesterday, and close to the summer surge peak of 67,337 on July 23, 2020.

The second graph shows the number of people hospitalized.

This data is also from the CDC.

The CDC cautions that due to reporting delays, the area in grey will probably increase.

The current 7-day average is 32,773, down from 33,726 yesterday, but well above the post-summer surge low of 23,000.

by Calculated Risk on 4/05/2021 04:00:00 PM

Note: This is as of March 28th.

From the MBA: Share of Mortgage Loans in Forbearance Decreases to 4.90%

The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that the total number of loans now in forbearance decreased by 6 basis points from 4.96% of servicers’ portfolio volume in the prior week to 4.90% as of March 28, 2021. According to MBA’s estimate, 2.5 million homeowners are in forbearance plans.
...
“The share of loans in forbearance decreased for the fifth straight week, and new forbearance requests dropped to their lowest level since March 2020. The share of loans in forbearance also decreased for all three investor categories,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “More than 21 percent of borrowers in forbearance extensions have now exceeded the 12-month mark. Of those that exited forbearance in March, more than 21 percent received a modification, indicating that their income had declined and they could not afford their original mortgage payment.”

Fratantoni added, “March was a turning point for the economy, with hiring shifting into a higher gear and the unemployment rate continuing to decline. However, there are still more than 4.2 million people who have been actively looking for work for more than six months. Homeowners who are still facing hardships and need to extend their forbearance term should contact their servicer.”
emphasis added

Click on graph for larger image.

This graph shows the percent of portfolio in forbearance by investor type over time.  Most of the increase was in late March and early April, and has trended down since then.

The MBA notes: "Total weekly forbearance requests as a percent of servicing portfolio volume (#) decreased relative to the prior week: from 0.05% to 0.04%, the lowest level since the week ending March 15, 2020."

by Calculated Risk on 4/05/2021 03:43:00 PM

Note: I'm posting data for many local markets around the U.S. The story is the same everywhere ... inventory is at record lows.

From the DMAR: Monthly Indicators, March 2021

Total Residential Units Sold in March 2021 were 4,889, up 1.2% from 4,831 in March 2020.

Active Residential Listings in March 2021 were 1,921, down 66.7% from 5,776 in March 2020.

Inventory in Denver had been fairly steady over the last 6 or 7 years, but declined sharply in 2020.

by Calculated Risk on 4/05/2021 12:21:00 PM

Black Knight released their Mortgage Monitor report for February today. According to Black Knight, 6.00% of mortgages were delinquent in February, up from 5.85% of mortgages in January, and up from 3.28% in February 2020. Black Knight also reported that 0.32% of mortgages were in the foreclosure process, down from 0.45% a year ago.

This gives a total of 6.32% delinquent or in foreclosure.

Press Release: White-Hot Housing Market and Rising Rates Push Affordability Back to 5-Year Average; Low New Listing Volumes Further Constraining Inventory

Today, the Data & Analytics division of Black Knight, Inc. released its latest Mortgage Monitor Report, based upon the company’s industry-leading mortgage, real estate and public records datasets. This month, with the U.S. housing market remaining extremely hot by any historical measure, the report looks at home price appreciation over the past year and how that’s impacted affordability. According to Black Knight Data & Analytics President Ben Graboske, incredibly low levels of for-sale inventory, coupled with still historically low interest rates, continue to put upward pressure on home prices and tighten affordability.

“Our repeat sales-based Black Knight Home Price Index shows February’s annual price appreciation at 11.6%, the fastest growth rate in more than 15 years,” said Graboske. “Likewise, the daily home sales data tracked by our Collateral Analytics group found a nearly 16% year-over-year increase in the median sales price in February. Multiple years of constrained housing inventory and historically low interest rates have helped fuel this fire to the point where nearly 75% of the 100 largest U.S. markets have seen annual home price growth of 10% or higher. What’s more, Collateral Analytics’ Market Conditions Report shows the housing markets in 75% of ZIP codes rated either ‘Strong’ or ‘Hot’ based on underlying market metrics. Only 7% are characterized as ‘Normal.’

“Of course, upward pressure on home prices has also served to tighten affordability, and with rates on the rise, affordability concerns are coming into sharper relief. It now takes 20% of the median income to make the monthly payment on the purchase of an average-priced home, back up to the five-year average after several years of low interest rates mitigating the impact of rising prices on affordability. Housing is now the least affordable it’s been – factoring in interest rates, home prices and income – since mid-2019. Any hopes of 2021 bringing an influx of homes to the market and lessening pressure on prices appear to be dashed for now, as new for-sale listings were down 16% and 21% year-over-year in January and February, respectively. Rather than an influx of homes on the market, we’re now 125,000 fewer new listings in the hole compared to the first two months of 2020 and trending in the wrong direction. With higher interest rates and a continuing shortage of inventory, it will be important to keep a careful eye on both home prices and affordability metrics in the coming months.”
emphasis added

Click on graph for larger image.

Here is a graph from the Mortgage Monitor that shows Active Inventory and New Listings.

From Black Knight:

• Entering 2021, the number of homes listed for sale was down 32% year-over-year and had fallen to its lowest level on record, according to Black Knight’s Collateral Analytics division

• The hopes that early 2021 would bring much-needed inflow of inventory to a market starved for supply have been dashed so far, with new listing volumes coming in well below pre-pandemic levels

• In fact, the number of homes listed for sale in January was down 16% from the year prior, while new listings in February were down 21%

• Rather than an influx, we now have 125K fewer listings than over the first two months of 2020 and are trending in the wrong direction with inventory down 40% year-over-year

And on delinquencies from Black Knight:

• After eight consecutive months of improvement, the national mortgage delinquency rate rose in February from 5.85% to 6.0%

• Delinquency rate increases were seen broadly across portfolios, geographies and asset classes

• Despite the rise, 30-day delinquencies remain 19% below pre-pandemic levels, while there are still 5X (+1.7M) as many 90-day delinquencies as there were in February 2020

There is much more in the mortgage monitor.

by Calculated Risk on 4/05/2021 10:47:00 AM

One of the key questions for 2021 is: Will inventory increase as the pandemic subsides, or will inventory decrease further in 2021?

Tracking inventory will be very important this year.

Click on graph for larger image in graph gallery.

This inventory graph is courtesy of Altos Research.

As of April 2nd, inventory was at 310 thousand (7 day average), compared to 751 thousand the same week a year ago.  That is a decline of 59%.

A week ago, inventory was at 313 thousand, and was down 58% YoY.  Seasonally, inventory should bottom soon.

Mike Simonsen discusses this data regularly on Youtube.

by Calculated Risk on 4/05/2021 10:05:00 AM

(Posted with permission). The March ISM® Services index was at 55.3%, up from 55.3% last month. The employment index increased to 57.2%, from 52.7%. Note: Above 50 indicates expansion, below 50 contraction.

From the Institute for Supply Management: March 2021 Services ISM® Report On Business®

Economic activity in the services sector grew in March for the 10th month in a row, say the nation’s purchasing and supply executives in the latest Services ISM® Report On Business®.

The report was issued today by Anthony Nieves, CPSM, C.P.M., A.P.P., CFPM, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee: “The Services PMI® registered an all-time high of 63.7 percent, 8.4 percentage points higher than the February reading of 55.3 percent. The previous high was in October 2018, when the Services PMI® registered 60.9 percent. The March reading indicates the 10th straight month of growth for the services sector, which has expanded for all but two of the last 134 months.”

Nieves continues, “For further historical context, the Services PMI® debuted as the Non-Manufacturing NMI® in 2008, although subindex data was collected for years in advance. In August 1997, the four subindexes — Business Activity, New Orders, Employment and Supplier Deliveries — that make up the Services PMI® would have calculated a composite-index reading of 62 percent.

“The Supplier Deliveries Index registered 61 percent, up 0.2 percentage point from February’s reading of 60.8 percent. (Supplier Deliveries is the only ISM® Report On Business® index that is inversed; a reading of above 50 percent indicates slower deliveries, which is typical as the economy improves and customer demand increases.)

“The Prices Index figure of 74 percent is 2.2 percentage points higher than the February reading of 71.8 percent, indicating that prices increased in March, and at a faster rate. According to the Services PMI®, all 18 services industries reported growth. The composite index indicated growth for the 10th consecutive month after a two-month contraction in April and May. There was a substantial increase in the rate of growth in the services sector in March. Respondents’ comments indicate that the lifting of coronavirus (COVID-19) pandemic-related restrictions has released pent-up demand for many of their respective companies’ services. Production-capacity constraints, material shortages, weather and challenges in logistics and human resources continue to cause supply chain disruption,” says Nieves.
emphasis added

The employment index increased to 57.2% from 52.7% in February.