Wednesday, August 20, 2014

Reading Rates: MBA Application Survey – August 20 2014

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) decreased 6 basis points to 4.15% since last week while the purchase application volume decreased 0.4% and the refinance application volume increased 3% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).




Homebuilder Blues: NAHB/Wells Fargo Home Builder Ratings August 2014

Recently, the National Association of Home Builders (NAHB) released their latest Housing Market Index (HMI) showing that assessments of housing activity improved notably in August with the composite HMI index climbing to 55 from 53 the prior month while the "buyer traffic" index rose to a level of 42.

Looking at the data, its pretty clear that while there was a bit of a pullback in activity earlier in the year, homebuilder sentiment and, in particular, assessments of buyer activity have improved.




Wednesday, August 13, 2014

Retail Sales: July 2014

Today, the U.S. Census Bureau released its latest nominal read of retail sales  showing modest activity in July with sales going flat from June and rising 3.7% on a year-over-year basis on an aggregate of all items including food, fuel and healthcare services.

Nominal "discretionary" retail sales including home furnishings, home garden and building materials, consumer electronics and department store sales declined slightly, falling 0.1% from June but rising 1.68% above the level seen in July 2013 while, adjusting for inflation, “real” discretionary retail sales declined 0.23% on the month and falling 0.34% since July 2013.





Reading Rates: MBA Application Survey – August 13 2014

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) decreased 1 basis points to 4.21% since last week while the purchase application volume decreased 1% and the refinance application volume decreased 4% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).




Friday, August 01, 2014

Construction Spending: June 2014

Today, the U.S. Census Bureau released their latest read of construction spending showing slumping results for June with total private construction spending, single family construction spending and non-residential construction spending all declining over the month.

On a month-to-month basis, total residential spending declined -0.3% from May climbing 7.4% above the level seen in June 2013 and remaining well below the peak level seen in 2006.

Single family construction spending declined 1.40% from May rising 8.5% since June 2013 remaining well below it's peak level reached in 2006.

Non-residential construction spending declined 1.6% from May but rose 11.2% above the level seen in June 2013 and remaining a well below the peak level reached in October 2008.

The following charts (click for larger dynamic versions) show private residential construction spending, private residential single family construction spending and private non-residential construction spending broken out and plotted since 1993 along with the year-over-year, month-to-month and peak percent change to each since 1994 and 2000 – 2005.



Employment Situation: Nonfarm Payrolls and Civilian Unemployment July 2014

Today's Employment Situation Report indicated that in July, net non-farm payrolls increased by 209,000 jobs overall with the private non-farm payrolls sub-component adding 198,000 jobs while the civilian unemployment rate declined rose to 6.2% over the same period.

Net private sector jobs increased 0.17% since last month climbing 2.16% above the level seen a year ago and climbing 1.22% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration July 2014

Today's employment situation report showed that conditions for the long term unemployed were mixed in July while still remaining distressed by historic standards.

Workers unemployed 27 weeks or more increased to 3.155 million or 32.9% of all unemployed workers while the median term of unemployment increased to 13.3 weeks and the average stay on unemployment went declined to 32.4 weeks.



Employment Situation: Total Unemployment July 2014

Thursday's Employment Situation report showed that in July “total unemployment” including all marginally attached workers increased to 12.2% while the traditionally reported unemployment rate also worsened rising to 6.2%.

The traditional unemployment rate is calculated from the monthly household survey results using a fairly explicit definition of “unemployed” (essentially unemployed and currently looking for full time employment) leaving many workers to be considered effectively “on the margin” either employed in part time work when full time is preferred or simply unemployed and no longer looking for work.

The Bureau of Labor Statistics considers “marginally attached” workers (including discouraged workers) and persons who have settled for part time employment to be “underutilized” labor.

The broadest view of unemployment would include both traditionally unemployed workers and all other underutilized workers.

To calculate the “total” rate of unemployment we would simply use this larger group rather than the smaller and more restrictive “unemployed” group used in the traditional unemployment rate calculation.

Monday, July 28, 2014

Pending Home Sales: June 2014

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for June showing that pending home sales declined with the seasonally adjusted national index falling 1.1% from May and dropping 7.3% below the level seen in June 2013.

Meanwhile, the NARs chief economist Lawrence Yun indicated that while current activity has improved overall, conditions are still challenging for potential home buyers.

"Activity is notably higher than earlier this year as prices have moderated and inventory levels have improved, ... However, supply shortages still exist in parts of the country, wages are flat, and tight credit conditions are deterring a higher number of potential buyers from fully taking advantage of lower interest rates."

The following chart shows the seasonally adjusted national pending home sales index along with the percent change on a year-over-year basis as well as the percent change from the peak set in 2005 (click for larger version).

Thursday, July 24, 2014

New Home Sales: June 2014

Today, the U.S. Census Department released its monthly New Residential Home Sales Report for June showing a notable decline with sales declining 8.1% from May falling 11.5% below the level seen in June 2013 remaining near an historically low level with 406K SAAR units.

The monthly supply increased to 5.8 months while the median selling price increased 5.27% and the average selling price increased 8.27% from the year ago level.

The following chart show the extent of sales decline to date (click for full-larger version).

Monday, July 21, 2014

The Chicago Fed National Activity Index: June 2014

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that the national economic activity weakened in June with the index falling to a very weak level of 0.12 from a level of 0.16 in May while the three month moving average worsened to a weak level of 0.13.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

Tuesday, July 15, 2014

Retail Sales: June 2014

Yesterday, the U.S. Census Bureau released its latest nominal read of retail sales  showing increasing activity in June with sales rising 0.2% from May and 4.3% on a year-over-year basis on an aggregate of all items including food, fuel and healthcare services.

Nominal "discretionary" retail sales including home furnishings, home garden and building materials, consumer electronics and department store sales declined slightly, falling 0.31% from May but rising 1.73% above the level seen in June 2013 while, adjusting for inflation, “real” discretionary retail sales declined 0.48% on the month and falling 0.26% since June 2013.





Wednesday, July 09, 2014

Reading Rates: MBA Application Survey – July 09 2014

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) increased 2 basis points to 4.19% since last week while the purchase application volume increased 4% and the refinance application volume increased 0.4% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).




Monday, July 07, 2014

Employment Situation: Nonfarm Payrolls and Civilian Unemployment June 2014

The latest Employment Situation Report indicated that in June, net non-farm payrolls increased by 288,000 jobs overall with the private non-farm payrolls sub-component adding 262,000 jobs while the civilian unemployment rate declined to 6.1% over the same period.

Net private sector jobs increased 0.22% since last month climbing 2.13% above the level seen a year ago and climbing 1.04% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration June 2014

Thursday's employment situation report showed that conditions for the long term unemployed improved in June while still remaining distressed by historic standards.

Workers unemployed 27 weeks or more declined to 3.081 million or 32.8% of all unemployed workers while the median term of unemployment declined to 13.1 weeks and the average stay on unemployment went declined to 33.5 weeks.