Key SFR Data Release Summary for August 2023

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Looking for a place where all the key SFR data releases from the month are summarized in one place? You found it!

Monthly Releases: Economic Indicators

Consumer Price Index

Bureau of Labor Statistics | Press Release | August 10, 2023

Headline: July CPI report shows inflation gauge rose 3.2%, less than expected (CNBC)

Key Takeaways:

• The All Item CPI increased 3.2% for the 12 months ending in July, after increasing 3% for the 12 months ending in June.
• The All Item CPI increased 0.2% MoM in July, the same increase as June.
• The index excluding Food & Energy increased 4.7% over the last 12 months, the second month in a row the increase was less than 5%.
• The index for shelter accounted for over 90 percent of the all items index increase.
• “More economists are beginning to expect the U.S. can avoid a recession despite the aggressive rate hikes. Bank of America, Goldman Sachs and JPMorgan Chase all recently have forecast that a contraction is becoming less likely.” (Jeff Cox, CNBC)

Small Business Optimism Index

National Federation of Independent Business | Report | August 8, 2023

Key Takeaways:

• The Optimism Index increased 0.9 points in July to 91.9 after increasing 1.6 points in June, still well below the 49-year average of 98. 
• 21% of owners reported inflation as their single most important problem in operating their business, down 3 points from last month.
• Owners expecting better business conditions over the next six months improved 10 points from June, making this the highest reading since August 2021 but historically still very negative.
• “The long anticipated, predicted, recession is nowhere to be seen (almost)… The Fed staff (not FOMC) has changed their recession forecast to a “slowdown.” There is more talk about a “soft landing” and less of a recession.” (William Dunkelberg & Holly Wade, Small Business Optimism Index report)

Employment Situation Summary

Bureau of Labor Statistics | Press Release | August 4, 2023

Headline: Employment Report: 187K Jobs Added in July

Key Takeaways:

• Total nonfarm payroll employment increased by 187,000 in July and the unemployment rate changed little at 3.5% compared with 3.6% in June.
• The unemployment rate has ranged from 3.4 percent to 3.7 percent since March 2022.
• In July, job gains occurred in health care, social assistance, financial activities, and wholesale trade.
• In July, employment in leisure and hospitality was little changed (+17,000). The industry has shown little employment change in recent months, following average monthly gains of 67,000 in the first quarter of the year.

Consumer Sentiment

University of Michigan | Press Release | August 28, 2023

Key Takeaways per Joanne Hsu, Survey Director: 

• “After rising sharply for the past several months, consumer sentiment moved sideways in August and is not statistically different from July.” (Joanne Hsu)
• Sentiment sits at about 39% above the all-time historic low reached in June 2022.
• “The long-run economic outlook fell back about 12% this month but remains higher than just two months ago.” (Joanne Hsu)

Monthly Releases: Housing and SFR Data

Single Family Rent Index

CoreLogic | Press Release | August 25, 2023

Key Takeaways:

• U.S. single-family rents grew by 3.3% percent year over year in June, the lowest such gain since autumn 2020.
• Month-over-month rent growth of 1.1% nearly matched the pre-pandemic average growth of 1% for June.
• “Increases for attached properties were 1.5x that of detached properties in June; this is historically not the case, as both housing types tend to rise at the same pace.” (Molley Boesel, CoreLogic)

Case-Shiller Home Price Index

S&P CoreLogic | Press Release | August 29, 2023

Key Takeaways:

• The National Price Index reported 0% annual change in June, after decreasing -0.4% in May.
• The National Price Index posted a 0.9% MoM increase in June, after posting a 1.2% MoM increase in May.
• “Our National Composite rose by 0.9% in June, and it now stands only -0.02% below its all-time peak from exactly one year ago.” (Craig Lazzara, S&P DJI)

July Rental Report

Realtor.com | Press Release | August 21, 2023

Key Takeaways:

• July 2023 marks the third month of year-over-year rent decline in a row for 0-2 bedroom properties (-1% YoY).

• Rent for studios saw its first year-over-year decline in over two years.
• Nationwide affordability improved slightly with renters earning the typical household income devoting 25.9% of their income to their lease, compared with 26.5% in July 2022. 
• On a market level, Miami is the least affordable rental market with typical households spending 44.2% of their income on a typical rent.

New Residential Construction

HUD | Press Release | August 16, 2023

Headline: Construction of new homes jumps in July as mortgage rates continue to rise (NY Post)

Key Takeaways: 

• Building permits were up 0.1% MoM in July, and single-family permits increased 0.6% MoM. 
• Housing starts were up 3.9% MoM in July and up 5.9% YoY, and single-family starts were up 6.7% MoM.
• Permits for housing projects with five units or more fell 0.2% to a rate of 464,000 units, the lowest level since October 2020.

New Residential Sales

HUD | Press Release | July 26, 2023

Headline: New home sales picked up significantly in July. Can it last? (HousingWire)

Key Takeaways:

• New Home Sales were up 4.4% MoM in July and up 31.5% YoY, after seeing a MoM decrease of 2.5% in June. 
• Sales of New Homes that were “Not Started” in construction represented only 13% of total New Home Sales in July, compared to 23% of New Home Sales in July 2022 – this indicates that last year consumers were purchasing homes very early on in the process.
• In July 2023, 40% of new houses were sold for less than $400,000 compared with a year earlier when 33% cost less than $400,000 (Holden Lewis, NerdWallet)

Existing Home Sales

NAR | Press Release | August 22, 2023

Key Takeaways:

• Existing home sales dropped 2.2% MoM in July, after falling 3.3% in June, and decreased 16.6% YoY.
• Individual investors or second-home buyers purchased 16% of homes in July, down from 18% in June but up from 14% one year ago.
• Regionally, existing home sales in the West increased 2.7% MoM in July after decreasing 5.1% in June. All other regions saw a month-over-month decline.
• “Two factors are driving current sales activity – inventory availability and mortgage rates,” said NAR Chief Economist Lawrence Yun. “Unfortunately, both have been unfavorable to buyers.”

Pending Home Sales Index

NAR | Press Release | August 30, 2023

Key Takeaways:

• Pending home sales increased 0.3% MoM in June, the first month-over-month increase since February.
• The South and West posted monthly losses, while sales in the Northeast and Midwest grew.
• “The recovery has not taken place, but the housing recession is over. The presence of multiple offers implies that housing demand is not being satisfied due to lack of supply. Homebuilders are ramping up production and hiring workers.” (Lawrence Yun, NAR)

Quarterly Releases: Earnings Statements

Tricon Residential

Press Release | August 9, 2023

• Acquired 805 homes in Q2 and reduced guidance from 2,000-4,000 acquired homes in 2023 down to 2,000 homes for the year.
• Reduced guidance for NOI, Revenue, and Expense Growth from 6-7.5% to 6-7% due to a combination of fewer rent increases because of lower resident turnover, elevated property taxes, and lower turnover expenses.
• Same-home cost to maintain per home decreased 5.3% YoY by focusing on cost savings initiatives like their National Procurement Program, Scope Management – reducing high-cost projects when possible, and Internalization of maintenance resources.

Tricon expanded its single-family rental portfolio to 37,162 homes.