After last week's slew of housing data, including positive Housing Starts and Existing Home Sales, another busy week is in store. There are five major housing reports scheduled for the current week, and we thought you would want to be prepared for what should move your holdings. We've got two real estate pricing measures ahead; the S&P Case Shiller Home Price Index and the FHFA House Price Index. Plus, New Home Sales is on the slate and Pending Home Sales - each is capable of affecting the shares of homebuilders. Complementing the monthly data points is the weekly mortgage activity report.
The S&P Case Shiller Home Price Index is expected to show another month of price increase when it is reported Tuesday morning premarket, this time for July. Economists surveyed by Bloomberg see the 20-city composite rising 0.9% on a seasonally adjusted basis. That would follow June's reported increase of the same. On a year-to-year basis, sales are expected to have grown by 1.2%, following June's 0.5% increase. It's more good news for real estate enthusiasts, and it could support the shares of stocks which support housing, both new and existing. That includes the mortgage lenders like Bank of America (BAC) and Wells Fargo (WFC), and mortgage insurers like MGIC Investment (MTG) and title insurers like Investor's Title (ITIC).
Also Tuesday, though at 10:00 AM, we'll get the House Price Index from the Federal Housing Finance Agency (FHFA). This index covers single family housing units based on Fannie Mae (OTC: FNMA.OB) and Freddie Mac (OTC: FMCC.OB) data. Economists see this index showing a 0.8% increase in home prices for July. It would follow June's 0.7% rise. The key word is "rise," and any number around it would do just fine.
The next housing data point arrives Wednesday morning, when the New Home Sales Report is released at 10:00 AM. Economists see the annual pace of new home sales improved in August to 380K, up from 372K reported for July. Obviously, this data point should drive the shares of stocks like PulteGroup (PHM) and Toll Brothers (TOL).
Also on Wednesday, the Mortgage Bankers Association (MBA) offers its latest on mortgage activity in the pre-market. Last week's Weekly Applications Survey indicated the Market Composite Index of mortgage activity edged lower by 0.2% for the week ending September 14. This was despite the record low mortgage rates reported for some types of loans. Given seasonal holidays in September, it will continue to be difficult to read the data and the impact of the Federal Reserve announcement.
Pending Home Sales will be reported Wednesday as well, at 10:00 AM. Economists see this forward looking measure marking a 0.3% increase for August, though that is a slower rate of gain than the 2.4% increase reported for July. Still, it's a gain, which is a trend that is serving to support this industry against an otherwise softening economy.
The housing relatives have done especially well over the course of this year, and will continue to do so until the macroeconomic floor drops out from under them and the fiscal cliff and geopolitical wildcards destabilize stocks generally. When that happens, you'll not want to have exposure to cyclical high-beta stocks of any sort, including housing relatives. But for this week at least, it looks as if the party will go on.