Tuesday: Apartment Vacancy Survey, Job Openings

From Nick Timiraos at the WSJ: Why Home-Price Gains Will Slow Amid Higher Mortgage Rates. Timiraos suggests seven areas to watch, here are a few:

4. What does this mean for investors? If anyone gains, it could be investors that have been buying up cheap homes as rental properties. “I see investors licking their chops,” said Redfin’s Mr. Kelman. “Investors were really getting frustrated this spring trying to compete against all this funny money” from low rates. Also, to the extent that rising rates freeze would-be buyers out of the market, that should help increase rental demand.

There have been signs, however, that higher home prices have prompted investors to dial back their purchases because it’s become more difficult to dig up bargains, even before rates began to rise.

[CR: I disagree that this is good for investors. I think higher rates will slow investor buying because of competing returns on other investments.]

5. How fast will inventory rise? Even before rates increased, the number of homes offered for sale was rising at a slightly faster pace than it normally does during the spring, even though inventory in May was still around 10% below last year’s level. One sign that inventory has picked up is that competitive offer situations are dropping. The share of offers written by Redfin agents that faced a competing offer fell to 69.5% of offers in May, down from 73.3% in April. One year ago, some 69.3% of offers faced at least one competing bid.

Markets that have seen larger increases in listings have seen even bigger declines in multiple-bid situations. In Orange County, Calif., where the inventory of homes for sale is up by more than one third since March, some 84% of homes where Redfin agents wrote an offer in May had competing bids, compared to 94% in April. In San Diego, some 73% of offers in May had multiple offers, compared to 87% in April.

[CR: I think inventory is key]

6. Is this the end of the housing rebound? [CR short answer: no]

Tuesday:
• Early: Reis Q2 2013 Apartment Survey of rents and vacancy rates.

• At 7:30 AM ET, NFIB Small Business Optimism Index for June. The consensus is for an increase to 94.7 from 94.4 in May.

• At 10:00 AM, the Job Openings and Labor Turnover Survey for May from the BLS. The number of job openings has generally been trending up.