Thread by @RickPalaciosJr

Doing monthly review of our macro housing/econ 350+slide deck. Ten charts grabbing my attention for July:

1/10: Percentage of banks easing credit standards for HELOCs (home equity line of credit) now highest ever post-housing induced 2007-2009 recession.

2/10: Acceleration in residential electric customers (proxy for household formations) has subsided. Ties directionally to some of the normalizing we're seeing in for-sale housing market.

3/10: Home builder labor shortages get a ton of attention lately (rightly so), but more of a structural issue than cyclical/transitory. Builders reporting elevated labor shortages goes all the way back to 2013 coming out of last housing downturn.

4/10: Single-family homes not yet started (green) = 30% of all new home inventory today. Completed homes on the other hand (red) = 11%, a record low. Speaks to tight new home standing inventory we're seeing.

5/10: Builders have 17% fewer communities to sell from compared to this time last year across top housing markets. Thesis is this should start slowly rebounding going forward, namely in 2022.

6/10: Probably need to expand the y-axis on our home value vs. income growth chart. Spread b/w the two has blown out like we've really never seen before.

7/10: Home payment to income ratio (what matters the most) still within realm of healthy. This is all about rates, so can shift quickly. Approaching late-2018 level when mortgage rates hit ~5% and market slowed. Will be interesting to see how it shakes out this time.

8/10: Saving for a down payment is still #1 hurdle for single-family renters who would prefer owning vs. renting. Need to improve credit score = #2 hurdle.

9/10: Gas prices highest since 2014. Wondering if any peak-WFH tertiary market home buyers getting called back to office (even 1-2 days a week) are having buyer's remorse given payment shock at the pump.

10/10: Yield chasing in 1 chart. Spread b/w high-yield & investment grade corporates keeps shrinking. Rereading 'Predator's Ball' currently, so maybe some bias in featuring high-yield chart this month 😉