Thursday, April 27, 2017

Pending Home Sales: March 2017

Today, the National Association of Realtors (NAR) released their Pending Home Sales Report for March showing an notable decline in sales activity with the seasonally adjusted national index falling 0.8% from February but remaining 0.8% above the level seen in March 2016.

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).

Wednesday, April 26, 2017

NAR Against Tax Reform is Self Interest Over Common Sense

The National Association of Realtors nearly immediately met today's Trump administration tax reform policy announcement with outright rejection suggesting that the proposed changes were placing "home-ownership in the cross-hairs" and further suggested that the proposed tax changes would "nullify" the current tax benefits of owning a home.

It's important to note though that the primary issue that the NAR has taken with the proposal has only to do with how it may change the use of the mortgage interest deduction (and NOT the primary residence exclusion which the administration directly indicated was unaffected) which would only come as a result of the proposed increase in the standard deduction.

Since, under the Trump proposal, individuals and households would have a larger standard deduction (apparently 2x larger!) there would fewer tax filers itemizing their deductions (i.e. they would be taking the standard deduction in lieu of itemizing) and thus fewer caring about the tax "benefit" of taking on a mortgage.

So, while the presumed impact of the loss of this "benefit" has the NAR concerned about their private interest, common sense tells us that this is not a loss in any normal sense and further that taxpayers overall would be better off with a 2x increase in their standard deduction than the perverse incentive of taking on more housing debt.

UPDATE: Apparently the mortgage interest deduction is now NOT changing so NAR need not reject major tax reform only to protect their own self interest.

Tuesday, April 25, 2017

S&P Core Logic Case-Shiller: February 2017

Today's release of the S&P Core Logic Case-Shiller (CSI) home price indices for February reported that the non-seasonally adjusted National index increased from January with prices rising 0.24% while the non-seasonally adjusted Composite-10 city index increased 0.33% and the Composite-20 city index increased 0.42% over the same period.

On an annual basis, the National index increased 5.76% above the level seen in February 2016 while the Composite-10 city index increased 5.19% and the Composite-20 city index increased 5.85% over the same period.

On a peak basis, the non-seasonally adjusted National index just surpassed the record high level seen prior the onset of the great recession rising 0.24% above the level seen in 2006 while the Composite-10 index remained -8.41% below the peak level and the Composite-20 remained -6.31% below.

FHFA Monthly Home Prices: February 2017

Today, the Federal Housing Finance Agency (FHFA) released the latest results of their monthly house price index (HPI) showing that in February, nationally, home prices increased 0.79% from January rising 6.43% above the level seen in February 2016.

The FHFA monthly HPI are formulated from home purchase information collected from mortgages that have been sold to or guaranteed by Fannie Mae and Freddie Mac.

New Home Sales: March 2017

Today, the U.S. Census Department released its monthly New Residential Home Sales Report for March showing an increase with sales rising 5.8% from February climbing 15.6% above the level seen in March 2016 but still remaining near an historically low level with 621K SAAR units.

The monthly supply declined to 5.2 months while the median selling price increased 1.19% and the average selling price increased by 5.58% from the year ago level.

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

Friday, March 10, 2017

Employment Situation: Nonfarm Payrolls and Civilian Unemployment February 2017

Today's Employment Situation Report indicated that in February, net non-farm payrolls increased by 235,000 jobs overall with the private non-farm payrolls sub-component adding 227,000 jobs while the civilian unemployment rate declined to 4.7% over the same period.

Net private sector jobs increased 0.18% since last month climbing 1.78% above the level seen a year ago and climbing 6.47% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration February 2017

Today's employment situation report showed that conditions for the long term unemployed generally improved in February.

Workers unemployed 27 weeks or more declined to 1.801 million or 23.8% of all unemployed workers while the median term of unemployment declined to 10.0 weeks and the average stay on unemployment went flat at 25.1 weeks.



Employment Situation: Total Unemployment February 2017

Today's Employment Situation report showed that in February “total unemployment” including all marginally attached workers declined to 9.2% while the traditionally reported unemployment rate declined to 4.7%.

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.

Wednesday, February 15, 2017

Industrial Production and Capacity Utilization: January 2017

Today, the Federal Reserve released their monthly read of industrial production and capacity utilization showing worsening results in January with total industrial production falling 0.25% from December and remaining flat at 0.01% above the level seen in January 2016.

Capacity utilization went declined from December dropping 0.49% below the level seen in January 2016 to stand at 75.35%.

It's important to note that industrial production is still showing significant weakness which, if all past periods were to serve at least as a rough guide, now clearly indicates notable trouble for the macro-economy.


Retail Sales: January 2017

Today, the U.S. Census Bureau released its latest nominal read of retail sales showing increasing activity in January with sales rising 0.4% from December climbing 5.6% 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 increased 0.74% from December and rose 0.92% above the level seen in January 2016 while, adjusting for inflation, “real” discretionary retail sales increased 0.19% on the month but fell 1.58% since January 2016.



NAHB/Wells Fargo Home Builder Sentiment: February 2017

Today, the National Association of Home Builders (NAHB) released their latest Housing Market Index (HMI) showing that overall assessments of housing activity generally worsened in February with the composite HMI index falling to 65 while the "buyer traffic" index declined notably to a level of 46.




Friday, February 03, 2017

Employment Situation: Nonfarm Payrolls and Civilian Unemployment January 2017

Today's Employment Situation Report indicated that in January, net non-farm payrolls increased by 227,000 jobs overall with the private non-farm payrolls sub-component adding 237,000 jobs while the civilian unemployment increased to 4.8% over the same period.

Net private sector jobs increased 0.19% since last month climbing 1.80% above the level seen a year ago and climbing 6.30% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration January 2017

Today's employment situation report showed that conditions for the long term unemployed went flat in January.

Workers unemployed 27 weeks or more increased to 1.850 million or 24.4% of all unemployed workers while the median term of unemployment declined to 10.2 weeks and the average stay on unemployment declined to 25.1 weeks.



Employment Situation: Total Unemployment January 2017

Today's Employment Situation report showed that in January “total unemployment” including all marginally attached workers increased to 9.4% while the traditionally reported unemployment rate increased to 4.8%.

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.

Tuesday, January 31, 2017

Pending Home Sales: December 2016

Yesterday, the National Association of Realtors (NAR) released their Pending Home Sales Report for December showing an improvement in sales activity with the seasonally adjusted national index rising 1.6% from November to stand 0.3% above the level seen in December 2015.

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).

Friday, January 06, 2017

Employment Situation: Nonfarm Payrolls and Civilian Unemployment December 2016

Today's Employment Situation Report indicated that in December, net non-farm payrolls increased by 156,000 jobs overall with the private non-farm payrolls sub-component adding 144,000 jobs while the civilian unemployment increased to 4.7% over the same period.

Net private sector jobs increased 0.12% since last month climbing 1.63% above the level seen a year ago and climbing 6.13% above the peak level of employment seen in December 2007 prior to the Great Recession.

Employment Situation: Unemployment Duration December 2016

Today's employment situation report showed that conditions for the long term unemployed went flat in December.

Workers unemployed 27 weeks or more declined to 1.831 million or 24.2% of all unemployed workers while the median term of unemployment increased to 10.3 weeks and the average stay on unemployment declined to 26.0 weeks.



Employment Situation: Total Unemployment December 2016

Today's Employment Situation report showed that in December “total unemployment” including all marginally attached workers decreased to 9.2% while the traditionally reported unemployment rate increased to 4.7%.

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.