February 20, 2013

Housing Starts and Mortgage Applications down.

February 20, 2013

Housing Starts and Mortgage Applications down.

Housing Starts (January 2013)

Starts – seasonally adjusted, annualized  890,000.  Previous was 973,000.  The data was at the bottom of the consensus range.

Permits – seasonally adjusted, annualized 925,000.  Previous was 909,000.

“Starts” are in units.  Construction of a 20 unit apartment building equals 20 Starts.  The multifamily component fell 24.1% in January after a 34.7% increase in December.

Housing Starts should be close to 1.5 million/year in order to keep pace with population growth assuming that the headship ratio (number of occupants/unit) remains constant.

MBA Mortgage Applications (week ended 2/15/2013)

Purchase Index – Week/Week -2.0%. Previous was -10.0%

Refinance Index – Week/Week -2.0%. Previous was -6.0%

Composite Index – Week/Week -1.7%. Previous was -6.4%.

The only good news here is that the bad news was not as bad as the previous week.

Taken together, these two surveys and yesterday’s 1 point dip in the Homebuilders survey index indicate that the rebound in housing has taken a break.  Higher rates and higher prices are contributory.

PPI (January 2013)

PPI Month/Month  +0.2% PPI Year/Year 1.4%

PPI Core (less food & energy) Month/Month  +0.2%

PPI Core (less food & energy) Year/Year 1.8%

Inflation remains acceptably contained.  Let’s reserve judgment until CPI comes out tomorrow.

Chain Store Sales (week ended 2/16/2013)

ICSC-Goldman Store Sales

Store Sales – Week/Week 2.7 %.

Previous was -2.5% Store Sales – Year/Year  +1.8 %. Previous was 2.1%.


Store Sales Year/Year +3.1%. Previous week’s year/year was +2.4%.

The difference between the two Chain Store Sales reports is a result of the fact that they are calculated in very different manners.

The Consumer Metrics Index of discretionary online shopping which is a very sensitive and near real time leading indicator has been increasing for the past 10 days.