Market Studies

First time claims for unemployment insurance continued to move sideways, dropping 5,000 to 366,000 for the week ended February 2, the Labor Department reported Thursday. Economists expected a larger decline to 360,000 from the prior week’s 330,000 initial claims.

Homeowners who refinanced their mortgage loans in the fourth quarter of 2012 reduced their interest rates by an average of 33 percent, a record savings not seen in 27 years of observance, according to Freddie Mac. ""On average, borrowers who refinanced reduced their interest rate by about 1.8 percentage points,"" said Frank Nothaft, VP and chief economist at Freddie Mac. This translates to about $3,600 in annual savings on a $200,000 loan, according to Nothaft.

National home prices ended the year by posting their biggest annual gain since May 2006, and prices rose in December for the 10th consecutive month, CoreLogic reported Tuesday. The data provider's Home Price Index (HPI) registered a year-over-year increase of 8.3 percent in December when including distressed sales. From November to December, prices barely moved higher, increasing just 0.4 percent.

On a national level, January home prices increased 5.4 percent from a year ago, but fell flat on a quarterly basis after inching up by just 0.9 percent, Clear Capital reported. Out of the four regions, the West maintained its lead with yearly gains and quarterly gains of 12.9 percent and 2.1 percent, respectively. The remaining three regions all saw price increases of less than 1 percent quarter-over-quarter. Dr. Alex Villacorta, director of research and analytics at Clear Capital, explained the softened quarterly gains suggest ""the budding recovery is not immune to the slower winter season.""

Subprime credit scores are declining across the country with strong declines in a few rebounding markets, according to Equifax. Designating credit scores below 620 as ""subprime,"" Equifax found the number of subprime borrowers decreased 2.1 percent from the third quarter of 2011 to the third quarter of 2012. The 2.1 percent translates to about 1 million Americans who rose from the subprime category. Equifax also found ""early housing-bust markets"" are experiencing improving credit scores as time passes since the worst of the foreclosure crisis.

The percentage of banks reporting stronger demand for mortgage loans dropped in the first quarter from the fourth quarter last year, the Federal Reserve reported Monday and a slightly greater percentage are lending standards. The results in the quarterly Senior Loan Officers Opinion Survey are consistent with anecdotal reports that mortgage loans are becoming easier to obtain. In the case of ""traditional"" mortgage loans, 1.5 percent of respondents reported ""somewhat"" tighter standings, 4.6 percent reported standards easing somewhat, and 1.5 percent reported standards easing considerably.

The low supply of housing stock recently reported is giving Capital Economics reason to believe home price forecasts under 5 percent are actually conservative estimates. Realtors in December expected prices to rise by about 3.5 percent over the next year, while consumer estimates were more modest at 2.5 percent for the same time period, according to a monthly housing report from the firm. But, with the low supply of inventory, Capital Economics anticipates much bigger gains in the future.

Fannie Mae maintained its position as the largest source for multifamily financing in 2012 after providing $33.8 billion to the sector. The figure translates into 560,000 multifamily units and represents the third highest acquisition year in the company's history. Meanwhile, the Mortgage Bankers Association (MBA) reported commercial and multifamily lending volume increased by 49 percent on a quarterly and yearly basis in Q4 2012.

Consumer confidence picked up somewhat in January, but the recent payroll tax hike put a ceiling on any major gains, according to the latest survey of consumers from Thomson Reuters and the University of Michigan (UMich). The Index of Consumer Sentiment climbed slightly to 73.8 in January from December's 72.9. The index read 75.0 in January 2012. According to a release accompanying the survey, January's potential gains were dulled by the payroll tax increase, which has had a significant impact on lower income households.

So, there's some sort of football game this weekend. Like many economists, I’m a bigger baseball fan than football, intrigued by the statistics in baseball, statistically a zero-sum game unlike most other sports. Just about every positive statistic in baseball for one player has a corresponding negative statistic for another.