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Mix-Ansicht- Housing Remains Solid!!! - leibovitz, 20.02.2002, 10:41
Housing Remains Solid!!!
Housing Remains Solid
Building permits rose 3.1% in January to a 1.706 million annual rate, the highest in a year (E243). More impressively, single-family permits rose 6.6% to a record 1.329 million rate, more than offsetting a 7.4% drop in multi-family permits (E0258). Permits were up in all four regions, indicating broad-based demand.
Aided by warmer-than-normal weather, housing starts did even better, climbing 6.3% to a 1.678 million unit annual rate. It was the highest rate since February 2000, breaking a small downtrend line in place since the December 1998 peak (E242). Economists thought starts would rise 2.6% to a 1.610 million unit rate. Additionally, December's drop was revised to -2.3% from -3.4%. In January, single-family starts rose 3.5% to a 1.345 million rate, the highest rate since December 1999, indicating good underlying demand (E0257). Apartment construction rose a strong 8.3%.Starts, however, were mixed by region.
On a y/y basis, trends look less impressive. Permits are down 1% from a year ago and starts are up by less than that amount (E238). Furthermore, on Friday, the NAHB reported that its Housing Market Index slipped two points to 58 in February and that its January reading was revised down by a point (E0240). Moreover, the MBA Purchase Index has fallen back to a more sustainable level over the past couple of weeks from the extraordinarily high readings earlier in the year (B566). Supported by relatively low mortgage rates, housing activity should remain fairly steady in the first half of the year, but could tail off a little later in the year, if interest rates rise. So call our outlook flat-to-down.
Small Business Optimism Continues Climbing
The NFIB Small Business Optimism Index rose 3.1 points to 103.5 in January, its third consecutive monthly advance (B0669). It was the highest reading since January 2000. Among notables, plans to add inventories rose 10 points to a record high 12% of all firms. And hiring plans jumped 11 points to a net 18% of all small businesses. The economic outlook six months from now improved, as the net percentage of small business owners expecting the economy to be better rose one point to 43% of all firms, the highest reading since 1992 and a clear reversal of the -16% seen in December 2000. According to the NFIB, readings this strong historically have been quickly followed by growth in the real economy. But widespread price cutting in order to clear inventory, together with weaker sales volume, continue to cut into profitability. -- KH
Business Loan Demand Is Booming...
...at least from where it had been! Short-term business loan demand rose nearly $7 billion in the latest week, and has risen nearly $17 billion from the first week of the year. The 13-week rates of change are also moving higher (E580). So despite reports that credit remains tight, demand appears to have picked up a little, and is likely related to inventory rebuilding.
Real estate loan demand also posted a hefty $14.3 billion increase in the latest week, and has risen $21.3 billion from the beginning of the year.
Not Again! Another California Earthquake Warning!
The last time we talked about this the Northridge area near Los Angeles experienced a light 4.2 magnitude quake at the end of January and suffered through two days of aftershocks. Now my sources tell me of the possibility of a stronger quake projected to most likely hit the Northern Bay area around February 27 (+/- 5 days). Let me know if you need more info on this or call me and I'll fill you in.
<ul> ~ quelle</ul>
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