CFNAI Increases In July To +0.34

The Chicago Fed’s National Activity Index (CFNAI) was a reading of +0.34 in July, up from June’s revised reading of -0.07. The positive figure indicates that the index is above its historical trend. The index’s 3-month moving average is at 0.00.

50 of the 85 individual indicators made positive contributions to the CFNAI in July, while 35 made negative contributions. 44 indicators improved from June to July, while 40 indicators deteriorated and 1 was unchanged. Of the indicators that improved, 12 made negative contributions.

The Production and Income index component registered +0.28 from -0.14 last month. Employment and Hours was at +0.11 from +0.11, Personal Consumption and Housing was at -0.06 from -0.10, and Sales, Orders, and Inventories was +0.01 from +0.06.

CFNAI Components

CFNAI

P&I

E&H

C&H

SO&I

The CFNAI is a weighted average of 85 indicators of national economic activity drawn from four broad categories of data: 1) production and income; 2) employment, unemployment, and hours; 3) personal consumption and housing; and 4) sales, orders, and inventories. Each of these data series measures some aspect of overall macroeconomic activity. 

It is constructed to have an average value of zero and a standard deviation of one. Since economic activity tends toward trend growth rate over time, a positive index reading corresponds to growth above trend and a negative index reading corresponds to growth below trend.

U.S. Existing Home Sales Increase To Annual Rate Of 5.59 Million In July

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 2.0% in July to a seasonally adjusted annual rate of 5.59 million. This annual rate is 10.3% higher than the 5.07 million-unit level in July 2014.

Lawrence Yun, NAR chief economist, says the increase in sales in July solidifies what has been an impressive growth in activity during this year’s peak buying season. “The creation of jobs added at a steady clip and the prospect of higher mortgage rates and home prices down the road is encouraging more households to buy now,” he said. “As a result, current homeowners are using their increasing housing equity towards the down payment on their next purchase.”

“Despite the strong growth in sales since this spring, declining affordability could begin to slowly dampen demand,” adds Yun. “Realtors® in some markets reported slower foot traffic in July in part because of low inventory and concerns about the continued rise in home prices without commensurate income gains.”

Rate Change

The existing home sales rate increased in 2 of the 4 U.S. regions in July:

  • Northeast: 0.70 million from 0.72 million month prior.
  • Midwest: 1.32 million from 1.32 million month prior.
  • South: 2.29 million from 2.20 million month prior.
  • West: 1.28 million from 1.24 million month prior.

Sales Rate

Total housing inventory at the end of July decreased 0.4% to 2.24 million existing homes available for sale. That represents a 4.8 month supply at the current sales pace.

Inventory and Supply

The median time on market for all homes was 34 days in June. That is down from 40 days in May. Short sales were on the market for a median of 129 days, while foreclosures typically sold in 39 days, and non-distressed homes took 33 days. 47% of homes sold in June were on the market for less than a month.

The national median existing home price for all housing types was $236,400, up 6.5% from a year ago.

Sales Price

U.S. House Prices In May 2015

U.S. S&P Case-Shiller Home Prices increased in May, with the 20-city composite index rising 1.1% (not seasonally adjusted). Year over year, the 20-City Composite is up 4.9%.

Composite 20 Change

The national house price level is now roughly equal to where it stood in February 2005.

Composite Index

Of the 20 cities tracked in the index, Los Angeles has had the greatest increase in home prices since 2000, while Detroit has been the only city where prices have declined.

Case-Shiller Index Cities

From a year ago, house prices have increased the most in Denver, where they rose 10.0%. Washington D.C. has had the slowest rate of annual increase, rising only 1.3%.

Case-Shiller Cities Change

Dallas and Denver are the only cities whose prices have increased beyond their pre-recession peak. Las Vegas remains the furthest below its peak.

Case-Shiller Table

The U.S. Federal Housing Finance Agency saw its national house prices increase 0.4% in May (not seasonally adjusted), and increase 5.7% from a year ago.

The FHFA HPI is calculated using home sales price information from mortgages either sold to or guaranteed by Fannie Mae and Freddie Mac.

FHFA Change

The U.S. index is roughly the same as its April 2006 index level.

FHFA Index

Of the 9 different geographic census divisions that FHFA tracks, house prices have increased the most year over year in the Pacific region and increased the least in the Middle Atlantic region.

FHFA Regions

CFNAI Moves Back Above Trend At +0.08 In June

The Chicago Fed’s National Activity Index (CFNAI) was a reading of +0.08 in June, up from May’s revised reading of -0.08. The positive figure indicates that the index is above its historical trend. The index’s 3-month moving average is at -0.09.

48 of the 85 individual indicators made positive contributions to the CFNAI in June, while 37 made negative contributions. 44 indicators improved from May to June, while 40 indicators deteriorated and 1 was unchanged. Of the indicators that improved, 13 made negative contributions.

The Production and Income index component registered -0.01 from -0.08 last month. Employment and Hours was at +0.12 from +0.06, Personal Consumption and Housing was at -0.07 from -0.05, and Sales, Orders, and Inventories was +0.03 from -0.01.

CFNAI Recent

CFNAI

Production and Income

Employment and Hours

Consumption and Housing

Sales and Inventories

The CFNAI is a weighted average of 85 indicators of national economic activity drawn from four broad categories of data: 1) production and income; 2) employment, unemployment, and hours; 3) personal consumption and housing; and 4) sales, orders, and inventories. Each of these data series measures some aspect of overall macroeconomic activity. 

It is constructed to have an average value of zero and a standard deviation of one. Since economic activity tends toward trend growth rate over time, a positive index reading corresponds to growth above trend and a negative index reading corresponds to growth below trend.

U.S. Existing Home Sales Increase To Annual Rate Of 5.49 Million In June

Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 3.2% in June to a seasonally adjusted annual rate of 5.49 million. This annual rate is 9.6% higher than the 5.01 million-unit level in June 2014.

Lawrence Yun, NAR chief economist, says backed by June’s solid gain in closings, this year’s spring buying season has been the strongest since the downturn. “Buyers have come back in force, leading to the strongest past two months in sales since early 2007,” he said. “This wave of demand is being fueled by a year-plus of steady job growth and an improving economy that’s giving more households the financial wherewithal and incentive to buy.”

Adds Yun, “June sales were also likely propelled by the spring’s initial phase of rising mortgage rates, which usually prods some prospective buyers to buy now rather than wait until later when borrowing costs could be higher.”

“Limited inventory amidst strong demand continues to push home prices higher, leading to declining affordability for prospective buyers,” said Yun. “Local officials in recent years have rightly authorized permits for new apartment construction, but more needs to be done for condominiums and single-family homes.”

Existing Sales Rate Change

The existing home sales rate increased in all 4 U.S. regions in June:

  • Northeast: 0.72 million from 0.69 million month prior.
  • Midwest: 1.33 million from 1.27 million month prior.
  • South: 2.20 million from 2.15 million month prior.
  • West: 1.24 million from 1.21 million month prior.

Existing Sales

Total housing inventory at the end of June increased 0.9% to 2.30 million existing homes available for sale. That represents a 5.0 month supply at the current sales pace.

Existing Home Supply

The median time on market for all homes was 34 days in June. That is down from 40 days in May. Short sales were on the market for a median of 129 days, while foreclosures typically sold in 39 days, and non-distressed homes took 33 days. 47% of homes sold in June were on the market for less than a month.

The national median existing home price for all housing types was $236,400, up 6.5% from a year ago.

Existing Sales Price