Economic Update – September 12, 2011

Retail sales fell 0.7% for the week ending September 3, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 2.7%.

The Institute for Supply Management reported that the monthly composite index of non-manufacturing activity rose to 53.3 in August from 52.7 in July. A reading above 50 signals expansion. It was the 21st straight month of expansion in the services sector.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 2 fell 4.9%. Refinancing applications decreased 6.3%. Purchase volume rose 0.2%.

The trade deficit decreased to $44.8 billion in July from a revised $51.6 billion in June. Exports rose 3.6% to $178 billion. Imports decreased 0.2% to $222.8 billion.

According to the Federal Reserve, consumer credit debt rose in July by $12 billion for a total credit level of $2.45 trillion. Revolving debt, which includes credit cards, fell by $3.4 billion. Non-revolving debt, including loans for cars, rose by $15.4 billion.

Wholesalers increased their inventories 0.8% to $462.4 billion in July. This followed a revised 0.6% rise in June. Sales at the wholesale level were little changed in July at $396.01 billion. On a year-over-year basis, sales were 15.1% higher since July 2010.

Initial claims for unemployment benefits rose by 2,000 to 414,000 for the week ending September 3. Continuing claims for the week ending August 27 fell by 30,000 to 3.7 million.

Economic Update – June 14, 2011

Retail sales rose 0.4% for the week ending June 4, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 2.5%.

The trade deficit decreased 6.7% to $43.7 billion in April from a revised $46.8 billion in March. Exports rose 1.3% to $175.6 billion. Imports decreased 0.4% to $219.2 billion.

Wholesalers increased their inventories 0.8% to $447.2 billion in April. This followed a 1.1% rise in March. Sales at the wholesale level rose 0.3% in April to $393.5 billion. On a year-over-year basis, sales were 14.4% higher since April 2010.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending June 3 fell 0.4%. Refinancing applications increased 1.3%. Purchase volume fell 4.4%.

Import prices rose 0.2% in May, following a revised 2.1% increase in April. On a year-over-year basis, import prices are up 12.5%. Export prices rose 0.2% in May. On a year-over-year basis, export prices are up 9%.

According to the Federal Reserve, consumer credit debt rose in April by $6.25 billion for a total credit level of $2.43 trillion. Figures for March were revised from an initial gain of $6 billion to a gain of $4.82 billion. Revolving debt, which includes credit cards, fell by $0.9 billion. Non-revolving debt, including loans for cars, rose by $7.2 billion.

Initial claims for unemployment benefits rose by 1,000 to 427,000 for the week ending June 4. Continuing claims for the week ending May 28 fell by 71,000 to 3.68 million.

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Economic Update – May 9, 2011

The Institute for Supply Management reported that the monthly composite index of manufacturing activity fell to 60.4 in April after reaching 61.2 in March. A reading above 50 signals expansion. It was the 21st straight month of expansion.

Total construction spending rose 1.4% to $768.9 billion in March, following a 1.4% decrease in February. Economists had anticipated an increase of 0.5% in March.

Retail sales fell 0.8% for the week ending April 30, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 2.8%.

Factory orders rose 3% in March to a seasonally adjusted $462.9 billion, following an upwardly revised 0.7% increase in February. Excluding the volatile transportation sector, orders rose 2.6%.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending April 29 rose 4%. Refinancing applications increased 6%. Purchase volume rose 0.3%.

The Institute for Supply Management reported that the monthly composite index of non-manufacturing activity fell to 52.8 in April from 57.3 in March. A reading above 50 signals expansion. It was the 16th straight month of expansion in the services sector.

The Labor Department reported that in the first quarter productivity rose at an annual rate of 1.6% and labor costs increased at an annual rate of 1%.

Initial claims for unemployment benefits rose by 43,000 to 474,000 for the week ending April 30. Continuing claims for the week ending April 23 rose by 74,000 to 3.73 million. The monthly unemployment rate rose to 9% in April from 8.8% in March.


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Economic Update – March 21, 2011

Last Week in the News


Retail sales rose 0.1% for the week ending March 12, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.1%.

The National Association of Home Builders/Wells Fargo housing market index rose one point in March to 17. An index reading below 50 indicates negative sentiment about the housing market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending March 11 fell 0.7%. Refinancing applications increased 0.9%. Purchase volume fell 4%.

The combined construction of new single-family homes and apartments in February fell 22.5% to a seasonally adjusted annual rate of 479,000 units. Single-family starts decreased 11.8%. Multifamily starts dropped 46.1%. Applications for new building permits, seen as an indicator of future activity, fell 8.2% to an annual rate of 517,000 units.

The producer price index, which tracks wholesale price inflation, rose 1.6% in February after a revised 0.7% increase in January. Core prices — excluding food and fuel — rose 0.2% in February.

Consumer prices rose a seasonally adjusted 0.5% in February, following a 0.4% increase in January. For the year, seasonally adjusted consumer prices are up 2.2%.

Industrial production at the nation’s factories, mines and utilities fell 0.1% in February, following a revised 0.3% increase in January. Compared to a year ago, industrial production is up 5.6%. Capacity utilization was 76.3% in February.

Initial claims for unemployment benefits fell by 16,000 to 385,000 for the week ending March 12. Continuing claims for the week ending March 5 fell by 80,000 to 3.7 million.

Economic Update – February 28, 2011

Last Week in the News


Existing home sales rose 2.7% in January to a seasonally adjusted annual rate of 5.36 million units from 5.28 million units in December. The inventory of unsold homes on the market declined 5.1% to 3.38 million, a 7.6-month supply at the current sales pace, down from an 8.2-month supply in December.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending February 18 rose 13.2%. Refinancing applications increased 17.8%. Purchase volume rose 5.1%.

The consumer confidence index rose to 70.4 in February from an upwardly revised 64.8 in January. It was the highest level since February 2008. The index was benchmarked at 100 in 1985, a year chosen because it was neither a peak nor a trough in consumer confidence.

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — fell 1% in December after a 1% decrease in November. On a year-over-year basis, prices fell 2.4% compared with December 2009.

Initial claims for unemployment benefits fell by 22,000 to 391,000 for the week ending February 19. Continuing claims for the week ending February 12 fell by 145,000 to 3.79 million.

Orders for durable goods — items expected to last three or more years — rose 2.7% in January after a revised 0.4% decrease in December. Excluding volatile transportation-related goods, orders posted a monthly decrease of 3.6%.

New home sales fell 12.6% in January to a seasonally adjusted annual rate of 284,000 units from a revised rate of 325,000 units in December. Economists had expected a pace of 310,000 units.

Upcoming on the economic calendar are reports on construction spending on March 1 and factory orders on March 4.

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California pending home sales rise in January

LOS ANGELES (Feb. 23) – The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) debuted its Pending Home Sales Index and released key distressed property data.

Pending home sales index:

Pending home sales in California increased in January, according to C.A.R.’s Pending Home Sales Index (PHSI)*.  The index was 93.6 in January, rising 13.6 percent from December’s index of 82.4, based on contracts signed in January.  Pending home sales are forward-looking indicators of future home sales activity, providing information on the future direction of the market.

“Pending sales typically rise in January from a seasonally slow November and December,” said C.A.R. President Beth L. Peerce.  “January’s pending sales should be reflected in higher existing sales activity in February and March and serve as a precursor to the spring home buying season.”

Distressed housing market data:

  • The total share of all distressed property types sold statewide in January was 54 percent, up from 50 percent in December, but down from 56 percent in January 2010.
  • Conventional sales made up the remaining share at 46 percent in January, down from 50 percent in December, but up from 44 percent in January 2010.
  • Of the distressed properties sold statewide, the total share of REO (real estate-owned) sales was 32 percent in January, up from 30 percent in December, but was down from 37 percent in January 2010.
  • The statewide share of short sales increased to 22 percent in January, up from 20 percent in December and up from 19 percent in January 2010.
  • The median price of homes sold in the state differed dramatically depending on the property type, with non-distressed properties selling for much higher prices than short sales and foreclosures.
  • The statewide median price of conventional properties sold in January was $367,150, 38 percent higher than the short sale median price of $265,500 recorded in January, and 85 percent higher than the January REO median price of $198,000.

Multimedia:

Share of Distressed Sales to Total Sales

Type of Sale

Jan-10

Dec-10

Jan-11

REOs (real estate-owned) 37% 30% 32%
Short Sales 19% 20% 22%
Total Distressed Sales 56% 50% 54%

Distressed Sales by Select Counties (Percent of total sales)

County/Region
Jan-10
Dec-10
Jan-11
CA 56 50 54
San Diego 34 28 33
Marin 37 34 43
Orange 41 38 43
San Luis Obispo 49 46 47
Los Angeles 54 50 54
Mendocino 49 57 55
Napa 68 54 59
Sonoma 54 55 61
Kern 69 71 70
Sacramento 68 66 73
Riverside 78 67 73
San Bernardino 76 72 74
Solano 76 74 81

*Note:  C.A.R.’s pending sales information is generated from a survey of more than 70 associations of REALTORS® and MLSs throughout the state.  Pending home sales are forward-looking indicators of future home sales activity, offering solid information on future changes in the direction of the market.  A sale is listed as pending after a seller has accepted a sales contract on a property.  The majority of pending home sales usually becomes closed sales transactions one to two months later.  The year 2008 was used as the benchmark for the pending homes sales index. An index of 100 is equal to the average level of contract activity during 2008.

Economic Update – February 21, 2011

Retail sales rose 0.3% to $381.57 billion in January after a 0.5% increase in December. It was the seventh straight monthly gain but the smallest since June. On a year-over-year basis, retail sales rose 7.8%.

Total business inventories rose 0.8% in December to $1.44 trillion, the highest level since January 2009. Total business sales rose 1.1% to $1.15 trillion in December, the highest level since September 2008.

The National Association of Home Builders/Wells Fargo housing market index was unchanged in February for the fourth consecutive month at 16. An index reading below 50 indicates negative sentiment about the housing market.

The combined construction of new single-family homes and apartments in January rose 14.6% to a seasonally adjusted annual rate of 596,000 units. Single-family starts fell 1%. Multifamily starts rose 77.7%. Applications for new building permits, seen as an indicator of future activity, fell 10.4% to an annual rate of 562,000 units.

The producer price index, which tracks wholesale price inflation, rose 0.8% in January after a revised 0.9% increase in December. Core prices — excluding food and fuel — rose 0.5% in January.

Industrial production at the nation’s factories, mines and utilities fell 0.1% in January, following a revised 1.2% increase in December. Compared to a year ago, industrial production is up 5.2%. Capacity utilization was 76.1% in January.

Initial claims for unemployment benefits rose by 25,000 to 410,000 for the week ending February 12. Continuing claims for the week ending February 5 rose by 1,000 to 3.9 million.

Upcoming on the economic calendar are reports on the housing price index on February 22, existing home sales on February 23 and new home sales on February 24.

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Foreclosure Report – January 2011

Foreclosure sales bounced back to levels not seen since robo-signing moratoriums went into effect last fall. With significant increases in Arizona, California, Nevada, Oregon and Washington; foreclosure sales rose both in terms of properties that went Back to the Bank and those Sold to Third Parties, typically investors. As a result Bank Owned Inventories (REO) increased everywhere except in Oregon where banks sold more homes then they took back.
“We have not seen this level of activity on the courthouse steps for months,” says Sean O’Toole, CEO and Founder of ForeclosureRadar.com. “The increase in foreclosures is just in time to provide a fresh supply of entry level homes for the spring home buying season.”

California
Reversing a four month declining trend, Notice of Default filings rose 6.9 percent month-over-month in California, while Notice of Trustee Sale filings dropped 13.8 percent from the prior month. Foreclosure filings year-over-year show only mild change, with Notice of Default filings down 3.3 percent and Notice of Trustee Sale filings slipping just 1.4 percent from January 2010. Foreclosure sales skyrocketed from December, with 51.5 percent more sales Back to Bank and 52.8 percent more properties purchased by Third Parties, typically investors. Cancellations were up as well, rising 12.4 percent this month as compared to last which was the first time in six months that cancelations increased month-over-month.

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