What it will cost you to rent a one-bedroom apartment in Boston: Latest stats

Statista: Where U.S. home prices are rising the fastest (and slowest)

You will find more infographics at Statista

Under construction: Local economy East Boston, Ward 1-Boston, 02128

BUSINESS DEVELOPMENT
#DBA New Certificates issued
10 for November 2017

EMPLOYMENT DATA
State Unemployment Rate (MA)
3.7% October 2017

U.S. Unemployment Rate
4.1% October 2017

Metro Boston Unemployment Rate*
3.3% September 2017

State and Area Employment (000s)
3,643 October 2017

Jobs Added MA YoY
69,000 October 2017

Suffolk County Unemployment# & Rate 13,410; 3.1% October 17 NSA

Boston Unemployment Rates
3.1% October 2016

U.S Productivity: 3.0% 3rd Qtr. 2017 est.

Suffolk County Avg. Wkly Wage
$2,016 (1st Qtr 2017)

Occupational Employment and Wage Estimates (Boston Metro 5/2016)
$32.66 (avg. hr)
$67,930 (avg. annual salary.)

HOUSING
Housing Permits (MA): 1568
October 2017

Massachusetts Homeownership Rate
59.7% (2016)

Change in FHFA State House Price Indexes
(Seasonally Adjusted, Purchase-Only Index, 2017Q2:1.96)


CONSUMER

U.S. CPI-U, All items, 12-month % change*
0.1% (10/2017 over 10/2016) All Items YoY: +2.0%

Boston Metro Consumer Price Index
2.7% (9/2017 over 9/2016)

ENERGY

Boston Average Price - Gasoline, Unleaded Reg., Per Gallon/ 2.560 October 2017

Massachusetts Average Price Heating Oil
$2.877 per gallon 11/27/17 (excl. taxes)

Stock Market: Local:
East Boston Savings Bank Stock Latest

Bloomberg MA Stock Index (BCMAX:IND)

The private sector was not helpful in curbing Fannie and Freddie

"Eyes Wide Shut? The Moral Hazard of Mortgage Insurers during the Housing Boom," a new NBER Working Paper by Neil Bhutta and Benjamin J. Keys 

Abstract:

In the U.S. mortgage market, private mortgage insurance (PMI) is mandated for high-leverage mortgages purchased by Fannie Mae and Freddie Mac to serve as a private market check on GSE risk-taking.  However, we document that PMI firms dramatically expanded insurance on high-risk mortgages at the tail-end of the housing boom, contradicting the industry's own research regarding house price risk.  Using three detailed sources of mortgage and insurance data, we examine PMI application denial rates, default rates on PMI-backed loans, and growth rates of high-leverage lending around the GSE conforming loan limit, along with information extracted from company, industry and regulatory filings and reports.  We conclude that PMI behavior during the housing boom in part reflects a "moral hazard" incentive inherent to insurance companies in general to underprice risk and be under-capitalized.  Our results suggest that rather than providing discipline, private mortgage insurers facilitated GSE risk-taking.

Gated copy of the working paper can be found here. 

Statista: 2-bedroom apartment rent in selected global cities

You will find more infographics at Statista

St. Louis Fed: "Warning: Don’t Infer Regional Inflation Differences from House Price Changes"

"There are a few reasons why regional house price growth does not measure regional inflation and thus does not accurately reflect changes in the cost of living. First, house prices capture both the price of housing services (i.e., shelter) and the value of housing as an asset (which is primarily the price of the land). The latter drives most of the change in house prices. As the value of housing increases (decreases), the return on investment for homeowners increases (decreases), driving up (down) the price that consumers will pay for housing. Changes in house prices are useful for studying broad housing market trends, as well as household wealth, but do not necessarily reflect changes in the actual cost of housing services for homeowners. "

From a new article by Charles S. Gascon and Andrew Spewak in Economic Synopses, a publication of the Federal Reserve Bank of St. Louis.

Rent control: the law of unintended consequences at work

"The Effects of Rent Control Expansion on Tenants, Landlords, and Inequality: Evidence from San Francisco," a new NBER Working Paper by Rebecca Diamond, Timothy McQuade and Franklin Qian

Abstract:

We exploit quasi-experimental variation in assignment of rent control to study its impacts on tenants, landlords, and the overall rental market. Leveraging new data tracking individuals’ migration, we find rent control increased renters’ probabilities of staying at their addresses by nearly 20%. Landlords treated by rent control reduced rental housing supply by 15%, causing a 5.1% city-wide rent increase. Using a dynamic, neighborhood choice model, we find rent control offered large benefits to covered tenants. Welfare losses from decreased housing supply could be mitigated if insurance against rent increases were provided as government social insurance, instead of a regulated landlord mandate. 

Contact NBER to get a copy of the paper.

Anthony Saunders of Confounded Interest; "Bubbles Shiller P/E Ratio Nears Roaring ’20s Bubble High As Home Prices Increased 43.6% Since Feb ’16"

"Asset bubbles too are difficult to define, but I know it when I see it."
Enough said.