Filtered by Subscriptions: US Housing Use setting US Housing
The rise in the number of homes for sale in California, to its highest level in a year, is not the good news it first appears. The increase is due to a drop in home sales, rather than a rise in listings. Instead of reflecting improved liquidity in the …
29th June 2018
The slowdown in annual house price growth to 6.4% on the Case-Shiller measure in April is in line with earlier data from the FHFA. In addition to record low levels of inventory, active housing demand is being held in check by rising mortgage interest …
26th June 2018
A decent 6.7% m/m rise in new home sales in May means the share of new single-family sales in total sales has reached a 10-year high. But that rise in sales has choked off what had been a steady rise in new home inventory, which is also coming under …
25th June 2018
Developments in the housing market continue to be dominated by record low levels of inventory. A scarcity of labour and high lumber prices are preventing builders from responding to that shortage. Single-family housing starts will therefore rise only …
22nd June 2018
The FHFA reported that house prices rose by a marginal 0.1% m/m in April, the second month in a row of small monthly gains. Even as inventory levels have stayed close to record lows, house price growth is being contained by subdued active housing demand. …
21st June 2018
Existing home sales dropped for the second month in a row in May, as record low levels of inventory have continued to constrain activity. With little chance of an improvement in the supply situation this year, sales are set to do little more than hold …
20th June 2018
Both single and multifamily housing starts rose in May, meaning total housing starts were up 20.3% compared to a year earlier, close to a two-year high. However, the building permit data show that single-family construction is still struggling to gain …
19th June 2018
We doubt the rise in mortgage demand from higher risk borrowers reported in the latest Fannie Mae survey will lead to a surge in mortgage lending. Cautious lenders and regulations mean that this market segment will remain small, even as more marginal …
14th June 2018
After eight years of stagnation, earnings growth finally looks set to accelerate. Household incomes have also received a boost from the tax cuts, which has helped raise rental growth expectations. Accordingly, landlords should now find it a little easier …
11th June 2018
The gradual decline in the number of multifamily units started for the rental sector went into reverse in the first quarter of 2018, with developers starting the most units since mid-2015. Rental demand is being supported by a lack of homes for sale, with …
7th June 2018
A 2.7% m/m drop in mortgage applications for home purchase left this measure of active housing demand unchanged compared to this time last year. A rise in mortgage interest rates, to a seven-year high of 4.80%, partly explains that lacklustre performance. …
6th June 2018
House price expectations have risen to an eight-year high on some measures, which raises the risk of a dangerous upward spiral in price growth developing. However, tight mortgage lending standards, and household concerns that prices are already too high, …
30th May 2018
March’s strong gain in the Case-Shiller national house price index appears consistent with some recent evidence that house price expectations have begun to rise. But it is harder to reconcile with the steady decline in the share of buyers who think now is …
29th May 2018
Despite high homebuilder confidence, single-family housing starts have lost momentum since the start of the year. A combination of lot and labour shortages, and the high price of materials, is responsible for that disappointing performance. Of those …
25th May 2018
Signs that the inventory of existing homes for sale had stabilised have proved to be short-lived. Inventory levels reached a new low in April. With so few homes on the market it is not surprising that existing home sales fell by 2.5% m/m, and we doubt …
24th May 2018
New home sales declined by 1.5% m/m in April, and downward revisions to the previous three months’ readings show that sales have struggled to gain traction so far this year. But, with the inventory of new homes for sale at a nine-year high, and with so …
23rd May 2018
As expected, a reversal of the surge in multifamily starts seen in March contributed to a 3.7% m/m drop in total housing starts in April. More of a concern is the lack of a sustained recovery in single-family construction. Despite very tight market …
16th May 2018
Against our expectation for a slow recovery, housing equity withdrawal has instead fallen back over the past year. In large part that reflects subdued home sales which, in turn, are being constrained by a lack of inventory. Increased spending on home …
15th May 2018
Strong house price gains in Western cities such as Seattle, San Francisco and Denver have pushed prices significantly above their previous highs seen just prior to the crash of the mid-2000s. However, the cause of the run-up in values this time around, …
11th May 2018
The rise in mortgage interest rates has had contrasting impacts on refinancing and home purchase mortgage applications. While refinancing applications dropped close to a 10-year low, home purchase applications rose to within sight of a nine-year high. …
8th May 2018
The rise in mortgage rates to a seven-year high of 4.8% over April has had contrasting impacts on refinancing and home purchase applications. Refinancing applications fell, approaching a 10-year low, while home purchase applications jumped to within sight …
2nd May 2018
The number of households in the rental sector has seen year-on-year declines in each of the last four quarters. But an equivalent supply response, with some homes shifting to the homeowner sector and a fall in the share of homes started for rent, has kept …
1st May 2018
With the 10-year Treasury yield breaching 3% earlier this week, mortgage rates are set to trend higher. That will push refinancing activity down to 18-year lows by the end of the year. Purchase demand is far less sensitive to rate changes, and may even …
27th April 2018
Given the number of existing homes for sale recently dropped to a record low, it is no surprise that the homeowner vacancy rate fell to 1.5% in the first-quarter, the joint-lowest rate for 24 years. That has put a stop to what had been a gradual rise in …
26th April 2018
Substantial upward revisions to new home sales in January and February, coupled with a 4.0% m/m rise in March, means new sales now look to have made a decent start to the year. The relatively healthy inventory of new homes for sale explains why new sales …
24th April 2018
Annual house price growth on both the Case-Shiller and FHFA measures has been fairly stable since the start of the year. After dropping for the first time in 18-months in January, growth on the national Case-Shiller index returned to 6.3% in February. A …
Existing home sales increased for the second month in a row in March. But, at 1.1% m/m, the rise was modest and sales are still lower than at this time last year. A lack of inventory explains that lacklustre performance. Despite a small improvement over …
23rd April 2018
At first glance the 1.9% m/m rise in housing starts, and 2.5% m/m increase in building permits, suggests the gradual recovery in home construction continued into March. But, in fact, growth in both measures was entirely driven by the notoriously volatile …
17th April 2018
Fannie Mae’s announcement last August that it would accept mortgages with debt-to-income (DTI) ratios as high as 50% triggered a sharp rise in the share of high DTI mortgages. But we doubt that change poses a risk to the housing market. Other lending …
16th April 2018
A divergence in rental vacancy rates over the past year, with single-family vacancies reaching a 21-year low as multifamily vacancies have risen, has meant rental growth for single-family homes has outpaced apartments for the past year. That reflects …
12th April 2018
Mortgage interest rates have risen to seven-year highs, which has pushed refinancing activity down to 10-year lows. Demand for home purchase mortgages is faring better, but even so buyers are still being put-off by the lack of inventory. Those tight …
10th April 2018
Mortgage interest rates reached a seven-year high in March, which in turn helped push refinancing activity to close to a 10-year low. Mortgage applications for home purchase performed better, rising by 6.6% m/m. But that only reversed a drop of a similar …
4th April 2018
One factor shared by states with particularly low levels of single-family permits is a high level of negative equity. Those states will have experienced the biggest housing market booms and busts, with many homebuilders put out of business, or concerned …
3rd April 2018
Our forecast that earnings growth will rise to a nine-year high of 3.5% by the middle of 2019 might be expected to give house prices a boost, particularly given the lack of inventory. However, the concurrent rise in mortgage interest rates will more than …
28th March 2018
Case-Shiller reported that annual house price growth edged back to 6.2% in January, from 6.3% in December. That is the first time annual growth has fallen since June 2016, and supports our view that house price gains peaked at the end of last year. We …
27th March 2018
The 0.6% m/m drop in new home sales was marginal, but it marks the third month in a row of falling sales. However, given the relatively healthy inventory of new homes and reports from homebuilders of strong demand, we doubt the weakness seen over the …
23rd March 2018
After two months of slowing house price gains, the sharp 0.8% m/m rise in January reported by the FHFA might be a sign that price growth is accelerating. But, given how volatile the monthly data are, we would caution against such an interpretation. With …
22nd March 2018
The 3% m/m gain in existing home sales in February was better than expected. Even so, that rise just reversed January’s drop, and left sales essentially unchanged from their level a year ago. With the months’ supply of homes for sale so depressed, it is …
21st March 2018
This quarter sees the launch of a redesigned US Housing Market Analyst. The aim of the Analyst, to provide our views on the outlook for the US housing market, remains the same. However, there is now a clearer distinction between homeowner and rental …
20th March 2018
The 7.0% m/m drop in housing starts in February was not a surprise. It was driven by the multifamily sector, where a 26.1% m/m drop fully reversed a similar surge in January. More of a concern is the apparent loss of momentum in the single-family sector, …
16th March 2018
Mortgage interest rates have continued to rise, averaging 4.63% in February; their highest level since the end of 2013. But more of an issue for sales is the chronic shortage of homes for sale, which has pushed buying sentiment down to nine-year lows. …
12th March 2018
The jump in mortgage applications seen in January has been quickly reversed, with total applications posting a 6.2% m/m drop in February. The rise in mortgage interest rates, which reached their highest level since the end of 2013, is weighing on …
7th March 2018
Single-family rental yields have been declining in most states over the past six years, with strong house price gains in the West leading to relatively large yield drops there. With interest rates on the rise, that may put house prices in states where …
5th March 2018
The Case-Shiller and FHFA house price indices painted contrasting pictures in December. Annual growth on the Case-Shiller index rose to 6.3%, the highest level since May 2014. But the FHFA reported a drop to 6.5%, the lowest reading in almost a year. …
27th February 2018
The 7.8% m/m drop in new home sales in January looks, at least partly, to reflect cold weather in the South and Northeast. With inventory levels at nine-year highs, and demand supported by rising household incomes, new homes sales are set for a decent …
26th February 2018
The impact of higher Treasury yields on mortgage rates has been softened by a narrowing of the spread between the two. That reflects a fall in the option cost of prepayment risk, as higher mortgage rates will cut the number of refinances. But, with …
23rd February 2018
Existing home sales fell for a second consecutive month in January, leaving them 5% lower than at the start of last year. The good news is that there was a marginal pick up in the number of existing homes available for sale. But with that improvement …
21st February 2018
At first glance it appears that housing starts had a very strong start to the year. The 9.7% m/m jump in January more than reversed December’s decline. But the volatile multifamily sector was responsible for most of that gain, and single-family starts …
16th February 2018
The decline in the first-time buyer share, to a two-year low, over the second half of last year reflected a lack of starter homes for sale, rather than a demand deficiency. With the lumber price at 14-year highs, and construction workers hard to find, the …
15th February 2018
In contrast to 2005, the recent surge and subsequent retreat in homebuilder share prices is not a signal that the housing market is set for a damaging correction. Back then, homebuilder share prices were boosted by a rapid easing in mortgage lending …
14th February 2018
