Morning Radar takes a brief look at HousingWire’s Monday Morning Cup of Coffee.
HousingWire.com, August 20th, 2012
Economists say housing recovery is for real
Data released this week should show a continued modest gain in housing demand, which continues to be boosted by investors. Both Bank of America housing economists and a Bloomberg survey indicate data on Wednesday will show existing home sales increased 3% to a seasonally adjusted annual rate of 4.5 million in July after tumbling 5.4% in June.
Look for new home sales — figures will be released on Thursday — to increase just over 4% to a 365,000 annual rate in July, partly reversing the 8.4% drop in June. And expect initial jobless claims to tick up to 370,000, bringing the four-week moving average to 367,000.
“Over the rest of the year, we expect further weakening in the labor market as the uncertainty shock from the fiscal cliff kick in,” BofAML economists said.
Vacancies declined in all property types in the commercial real estate sector in the second quarter, despite uncertainty in the global markets and concerns about the US economy, according to CBRE Econometric Advisors.
As a result, rents are rising. The markets exhibiting the strongest rent growth are San Francisco, San Jose, Calif., Oakland, Calif., Charlotte, Boston, New York and Austin, Texas, Moody’s Investor Service points out.
The the markets with highest vacancy rates — those above 7% — are Tucson, Ariz. Las Vegas, Jacksonville, Fla., Atlanta, Phoenix, Memphis and Houston.
Specially serviced loans tighten
The share of specially serviced loans fell 55 bps to 11.6% in the second quarter from the previous quarter’s 12.1%, Moody’s Investor Service says. The firm’s Specially Serviced Loan Tracker, or SSLT, has fallen in eight of the past 12 months, declining by 78 bps year over year. The current level is 116 bps below the April 2011 peak of 12.7%.
Performing specially serviced loans accounted for 20.3% of the specially serviced loan universe by balance in second-quarter, down 6% from the first-quarter. Moody’s says its delinquency tracker, or DQT, which rose to a new high of 9.9%, reflects the increasing share of non-performing loans.
Late last week the San Francisco Planning Commission unanimously approved the city’s first and the country’s largest affordable housing development specifically welcoming to lesbian, gay, bisexual and transgender seniors. Mercy Housing California and Openhouse, which provides housing to the Bay Area’s LGBT community, are heading the project.
The development — click here for a rendering — includes 110 apartments for low-income seniors, Openhouse service offices and an activity center for residents and LGBT seniors from across the city. Over 25,000 LGBT seniors live in San Francisco alone, many of whom do not access senior services and housing for fear of rejection and compromised care.