More snow storms and freezing weather on the way.......
Home builders starting to raise the white flag, expect earning warnings for Q1 blaming the weather......
Ford Motor Co. (F) and General Motors Co. reported declines in January auto sales that were greater than analysts had estimated, as cold weather kept shoppers from dealer lots.
Ford said sales fell 7.5 percent, which compared to the 2.3 percent drop analysts had estimated, according to data compiled by Bloomberg. GM said sales declined 12 percent, compared with a 2.5 percent average estimate from analysts.
Is there any doubt that home builders had similar results.................. and what about the ObamaCare rollout mess.........
NEW YORK (Reuters) - Manufacturing grew at a substantially slower pace in January as new order growth plunged by the most in 33 years, driving overall factory activity to an eight-month low, an industry report showed on Monday.
The Institute for Supply Management (ISM -0.04%, news) said its index of national factory activity fell to 51.3 last month, to its lowest level since May 2013, from a recently revised 56.5 in December.
January's figure was also well below the median forecast of 56 in a Reuters poll of economists, missing even the lowest estimate of 54.2. Readings above 50 indicate expansion.
The January reading marked a second straight month of slowing growth from November's recent peak reading of 57, which had been the highest since April 2011, suggesting the economy may be losing some of the momentum it had enjoyed in the second half of 2013.
The biggest red flag in the ISM report was the huge drop in the forward-looking new orders index, which fell to 51.2 from 64.4 in December. That 13.2-point drop was the largest monthly decline in that key component since December 1980.
Indicators of employment, production and inventory growth also declined from December. At 52.3, the employment reading was the weakest since June and well below December's 18-month high of 55.8.
They didn't pay any income tax on earnings in 2012 & 2013. In 2014 they will pay the normal tax rate 36% - 38%. They will need a lot of sales growth or expense reductions to make up the difference.
No wonder they would not give any forward looking sales or earnings figures......
Should be a shaky 2014 with pending orders and existing home sales trending down......
December new homes sales were released by the Census Bureau on Monday (Jan 27th). As I will lay out, December's report further confirms my thesis that the housing market is back in the bear market trend that started in mid-2005. Furthermore, as demonstrated by the degree that the Wall Street consensus forecast missed the actual result, the homebuilder stocks are overvalued based on market expectations that are way too high. All of the data I use comes from the report linked above unless noted otherwise.
Housing market sales data are reported as seasonally adjusted annualized rates (SAAR). This is important to note because the adjustments attempt to cleanse seasonality out of the data series for comparative purposes. A big part of my thesis for looking at the housing data incorporates analyzing the data on a month-to-month sequential basis for 2013 rather than looking at year over year comparisons. Headline reports and analysis are based on year over year comps. There is no question that the overall level of home sales was higher in 2013 than for 2012. But a definitive downtrend in the rate of sales over the course of 2013 shows that the market for new homes is headed lower.
The reported number of 414k missed the consensus expectation of 450k by 8% and was 7% below November's 445k. October and November numbers were both revised lower by 11k and 19k, respectively, or a combined 30k. Using the revised, more accurate data, the rate of decline in home sales from October to November was 3.9% and the rate of decline from November to December was 7%. As noted above, the numbers are theoretically "cleansed" of seasonal variability, which means the decline can be attributed to falling demand. My bet is that December's number will also be revised lower when next month's report is released, which means the drop in sales from November to December was probably even bigger than 7%.
For the quarter, the Company reported 3,214 net new orders, a decrease of 18% from prior year orders of 3,926. PulteGroup's backlog at year end totaled 5,772 homes valued at $1.9 billion, compared with prior year backlog of 6,458 homes valued at $1.9 billion.
Stock closes $19.71 no where near Socialbooms $21.
Just like Obama's State of the Union speech...... boring........
The universe doesn't have enough nations to borrow money from...... did you forget to take your meds this morning.....
That nose ring and fish hook must be getting rusty by now........ hope you're current with your tetanus shoots.
Underwater mortgages mean less people available to buy a new home...... What don't you understand.
If you follow real estate prices or sales trends or the number of homes going into foreclosure, you’re apt to have a pretty positive feeling that things are improving. If you dig a little deeper, however, and look only at the 15 hardest hit states, you’ll find a totally different story.
While these outlier markets and metropolitan areas are also seeing improvement, they are still years away from breaking even and being whole again.
“In these pockets, we’re still looking at thirty, sometimes as much as forty percent of homes with mortgages that are underwater, which is significant,” says noted real estate attorney and author Shari Olefson in the attached video.
For example, December’s headline data from RealtyTrac showed the national rate slipping to 18% of homes being underwater or having negative equity (which simply means a homeowner owes more than the property is believed to be worth), but at the bottom of the scale, there are still 9.3 million “deeply underwater” homes that are in the hole by twenty five or more. In fact, six states that are at least ten points above the national average of 18%, including Nevada (38%), Florida (34%), Illinois (32%), Michigan (31%), Missouri (28%), and Ohio (28%).
The case in certain cities is even worse, as the latest data shows towns such as Las Vegas, Orlando, Tampa and Chicago still have negative equity ranging from 33 to 41 percent.
“It’s especially relevant now because interest rates are going up,” Olefson says, pointing out that these owners who have been unable to refinance out of a variable rate mortgages, as well as tax law changes that took effect January 1st, “will be even more tempted to walk away” from their homes.
“If you do a short sale now, you’re going to have to pay income tax on the amount that the bank forgives,” she says, in describing the expiration of the Mortgage Debt Forgiveness Relief Act.
Last month's decline in orders for durable goods, which range from toasters to aircraft, was the largest since July and reversed November's revised down to 2.6 percent rise from 3.4.
Looks like $21 never arrived and $16.75 is right around the corner....... enjoy.
PHM gets hammered into the 18's and the high cost of socialbooms Obamacare starting to place a burden on potential home buyers. First time buyers at all time low..........
1 in 5 mortgages drowning
9.3 million U.S. residential properties are underwater
January 9, 2014
RealtyTrac released its U.S. Home Equity & Underwater Report for December 2013, which shows that 9.3 million U.S. residential properties were deeply underwater, or about 1 in 5 of every property with a mortgage.
"Deeply underwater" is defined as worth at least 25% less than the combined loans secured by the property.
RealtyTrac’s report also found the following:
• States with the highest percentage of residential properties deeply underwater in December were Nevada (38%) Florida (34%) Illinois (32%) Michigan (31%) Missouri (28%) and Ohio (28%).
• Major metropolitan statistical areas with the highest percentage of residential properties deeply underwater in December were Las Vegas (41%) Orlando, Fla., (36%) Detroit (35%) Tampa, Fla., (35%) Miami (33%) and Chicago (33%).
• States with the highest percentage of equity-rich residential properties were Hawaii (36%) New York (33%) California (26%) Montana (24%) and Maine (24%. The District of Columbia also posted an equity-rich rate of 24%.
• Major metropolitan statistical areas with the highest percentage of equity-rich residential properties were San Jose, Calif., (37%) San Francisco (33%) Pittsburgh (30%) Buffalo, N.Y. (30%) and Los Angeles (29%).
• States with the highest percentage of deeply underwater residential properties in the foreclosure process included Nevada (65%) Florida (61%) Illinois (61%) Michigan (55%) and Ohio (48%).
• Major metro areas with the highest percentage of deeply underwater residential properties in the foreclosure process were Las Vegas (66%) Tampa, Fla. (63%) Chicago (62%) Orlando (61%) and Detroit (61%).
• States with the highest percentage of foreclosure properties with some equity included Oklahoma (62%) Colorado (54%) New York (52%) Texas (51% and North Carolina (45%).
The housing market has recovered sharply from its worst levels following the mortgage crisis. But even five years later, millions of homeowners are still struggling under huge amounts of home debt.
In the following video, Dan Caplinger, The Motley Fool's director of investment planning, looks at recent data from RealtyTrac noting that 9.3 million homeowners remain underwater on their homes by at least 25%. Dan points out how even a big rise in prices and efforts from JPMorgan Chase (NYSE: JPM ) , Bank of America (NYSE: BAC ) , and Wells Fargo (NYSE: WFC ) to agree to modify customer mortgages haven't made a huge dent in those numbers. Dan notes that big problems exist in hard-hit states like Nevada and Florida, causing potential problems for Hovnanian (NYSE: HOV ) , PulteGroup (NYSE: PHM ) , and other homebuilders seeking to recover from the worst of the crisis.
Confidence among U.S. home builders fell slightly in January after a big jump in December. A monthly sentiment index from the National Association of Home Builders fell one point to 56. Fifty is the line between positive and negative. December's four point jump was revised down by one point.
"Rising home prices, historically low mortgage rates and significant pent-up demand will drive a continuing, gradual recovery in the year ahead," said NAHB Chief Economist David Crowe. "However, the pace of the recovery could be stronger were it not for rising construction costs and inaccurate appraisals that are keeping some home sales from going through."
(Read more: Mortgage refinances bounce back as rates settle)
Of the survey's three components, buyer traffic fell the hardest, down three points. Current sales conditions fell one point and future sales expectations fell three points. Regionally, both the Northeast and the West saw the biggest jumps in home builder confidence, the South was flat, and the builders in the Midwest posted a one point drop in confidence.
A separate survey from the Mortgage Bankers Association showed mortgage applications to purchase a newly built home fell 11 percent in December month-to-month. This does not include any seasonal adjustments, so the drop could be attributed to slower home buying during the holiday season.
Looks like $21 never arrived and $16.75 is right around the corner....... enjoy.