Monday Report
Salt Lake County Residential Loans in Default March 3rd 2008




Mortgages in Default - Last 6 Months

Where is the biggest problem?

In Utah

  1. Salt Lake County - 1,592
  2. Utah County - 806
  3. Weber County - 504
  4. Davis County - 457
  5. Washington County - 315

Homeowners living near foreclosed properties will see their property values decrease $5,000 on average.

Source: Center for Responsible Lending, January 18, 2008

Residential Mortgages in Default or with Notice of Default - Salt Lake County County - Last 6 Months

Rank# Defaults Last 6 MonthsZipCity
115584118 Taylorsville
211784065 Riverton/Herriman
310484120 West Valley
410384084 West Jordan
58784119 West Valley
67684020 Draper
77384044 Magna
87384088 West Jordan
96584128 West Valley
105884116 Salt Lake
115484094 South Jordan
125384092 Sandy
134984104 Salt Lake
1449Not listed
154484115 Salt Lake
164284106 Salt Lake
174284121 Cottonwood Heights
183784094 Sandy
193584093 Sandy
203484105 Salt Lake
212884070 Sandy
222884103 Salt Lake
232684107 Salt Lake
242584117 Holladay
262484102 Salt Lake
272384123 Murray
282084109 Salt Lake
291884108 Salt Lake
301384124 Holladay
31884111 Salt Lake
32284006 Copperton
33284101 Salt Lake

Source: NewReach - Builders Decision, 2008

Tesco denies claims of US troubles

Tesco, the UK supermarket group, insisted on Tuesday that its US expansion plans were on track, amid growing speculation that the initial performance of its new Fresh & Easy discount grocery stores concept has fallen short of expectations.

Mike Dennis, an analyst at Piper Jaffray, is the latest commentator to question the success of Tesco's launch in the US.

He wrote in a note to clients that the 50 stores opened so far around Los Angeles, Las Vegas and Phoenix could be averaging sales of $170,000 a week, against what he said were planned initial sales of $200,000.

Mr Dennis argued that the slow start would hit Tesco's longer-term earnings projections.

Tesco said in a statement on Tuesday that the stores were "proving very popular". It added: "What we are seeing is growing sales, growing customer numbers."

There have been widespread anecdotal reports in the US that the small neighbourhood groceries, similar in concept to an Aldi discount store, have been failing to attract customers at the rate needed.

In December, Jack Brown, chief executive of Stater Brothers, a supermarket chain in southern California, said his stores had seen "almost no impact" from the first 20 Tesco stores that opened in his stores' territory.

Jim Prevor, a US grocery industry consultant and analyst, told a group of investors this month that he estimated the Tesco stores were averaging weekly sales volumes of $50,000 to $60,000.

Piper Jaffray said if traffic was slow "then Tesco must be concerned that the Fresh & Easy concept is not right and that they need to quickly find out what the issues are and re-set the concept or ranges".

It also argued that lack of traffic suggested the discount format was "not as robust a store concept as we first thought".

Tesco is continuing to push ahead with its ambitious US plans, with another 150 stores expected to open over the coming year in its initial markets.

It has committed 1.25bn ($2.48bn) over five years to its US expansion plans.

It is signing leases on additional store sites in northern California, where it is also planning to open a second large distribution centre outside Stockton.

Real estate agents in Chicago have also told local newspapers that the retailer is in the early stages of looking at potential sites for a distribution centre in the area.

Tesco is being closely tracked by US rivals. Wal- Mart is planning to test similarly sized new grocery stores in the Phoenix area and Safeway also plans to open small format stores in northern California .

Source: The Financial Times Limited 2008


Most Fresh & Easy outlets will be relatively small, at about 10,000 square feet. Although about the same sales-floor size as the average Walgreen's, a chain of drugstores, most food retailers in America are either much bigger (six Fresh & Easy's would fit into a typical supermarket and ten into the average Wal-Mart), or much smaller (each is about three times the size of a 7-Eleven convenience store).

Convenience - Tesco is betting that there is demand for smaller stores closer to home with fewer products, making it easier to find things. 40% of convenience sales come from cigarettes and tobacco, followed closely by beer and wine. As for nutrition, most offer little more than snacks and frozen pizza.

This is more like Japan where convenience and quality food are available together.


Salt Lake County Mortgages in Default or with a notice of Default

  • Where?
  • What zip codes are the highest?
  • Who is most at risk?

Bob Springmeyer

Bonneville Research

    • International Business Confidence
    • Business confidence is stable but weak; consistent with a U.S. economy that is contracting, expanding only marginally in Canada and Europe, and growing no better than potential in Asia and South America. Businesses' assessments of current economic conditions dropped to a new low on a four- week moving average basis. Real estate firms and financial institutions are the most worried, but business service firms and even manufacturers and high-tech firms are measurably more nervous. Pricing pressures remain subdued despite $100 oil.
    • GDP
    • There was no revision to reported economic growth in the fourth quarter; real GDP increased at an annualized 0.6% rate. The consensus expectation was for a small upward revision. There was a downward revision to imports, which increased GDP growth, and an offsetting downward revision to investment in inventories. Economic growth in the fourth quarter was poor, and the U.S. economy is likely in recession now.
    • The Conference Board Consumer Confidence
    • The Conference Board index of consumer confidence tumbled in February to 75 from a downwardly revised 87.3 in January (previously 87.9). With the exception of the Iraq invasion in 2003, the index is at its lowest level since November 1993. The present-situation component of the index led the decline, although expectations fell sharply as well. Assessments of labor markets conditions fell significantly.
    • PPI
    • Producer prices for finished goods rose by 1.0% in January, as prices for finished energy products rose once more, following some weakening in December. Prices for finished foods continued to rise rapidly as well. Excluding food and energy products, core PPI rose by 0.4% in January, which is the fastest month of core inflation in nearly a year. Inflation remained much stronger at earlier stages of processing; prices for core intermediate goods rose by 0.8% on the month while prices for core crude goods rose by 4.0%.
    • Durable Goods (Advance)
    • Orders for manufactured durable goods fell 5.3% in January following a 4.4% rise in December. Orders excluding transportation were down 1.6%. Shipments rose 1.8% over the month following two consecutive months of decline. Core capital goods orders were down 1.4% after rising by 5.2% in December.
    • S&P/Case-Shiller Monthly Home Price Indexes
    • Both the 10-city and 20-city composite S&P/Case- Shiller house price indices declined in December from November. The 10-city composite fell by 2.3% and the 20-city by 2.2%. Both were larger declines than in the month before. The 10-city composite was down 9.8% over the past year, the largest year-over- year decline since the index began in 1988. The 20- city composite was down 9.1% over the past year. Prices fell in all 20 metro areas in December. House prices continue to fall, with no signs of stabilization.
    • OFHEO Home Price Index
    • The Federal Housing Enterprise Oversight's index of repeat purchase house prices now reflects the dire conditions in the housing markets that have been evident in other measures of house prices for at least a year now. For the fourth quarter, OFHEO is reporting house price declines across the nation, with prices in the purchase-only index declining q/q in every state except Maine. Nationally, prices were down 1.3% q/q. On a year-ago basis, the U.S. price was down by 0.3%, the first such decline in the index's 16-year history. The all-transactions index, however, is holding up, with an increase of 0.8% y/y.
    • New Home Sales (C25)
    • Housing markets continued to soften, with sales of new homes falling by 2.8% in January from the previous month. According to the Census Bureau, sales have dropped to 588,000 units. Although not quite as weak as expected, this reading suggests that the housing correction is still not over. Further, the months of inventory is up to nearly 10, and the median price of a new house is 15% below its year-ago value.
    • Existing-Home Sales
    • January existing home sales data are more robust than anticipated, although the data do still indicate a weak market. According to the National Association of Realtors, January existing homes sales fell by 0.4%. The months of inventories increased to 10.3 months from near 10 at the end of last year. The median existing house price is down by 4.6% from one year ago.
    • MBA Mortgage Applications Survey
    • The market indices continued the downward trend this week. The composite index finished the week of February 22 at 665.1, down substantially from the past week. The purchase index finished at 358.2, barely higher than last week's value. But the big story is the fall in the refinance index, where refinance applications have decreased substantially as contract rates start to increase.
    • Chain Store Sales
    • Chain store sales rose a slight 0.5% in the week ending February 23, according to the International Council of Shopping Centers. Year-over-year growth also increased, rising to 2.3%, the first week with growth of more than 2% this year. The ICSC noted that Presidents' Day sales appeared to attract some consumers.
    • Mass Layoffs
    • The number of layoff actions involving at least 50 workers from a single establishment in January was 1,438, compared with 1,433 in December. As such, they involved 144,111 workers, compared to 141,750 in December. All numbers are seasonally adjusted. Mass layoffs are expected to continue to rise over the next several months.
    • Jobless Claims
    • Initial jobless claims increased by 19,000 to 373,000. While initial claims have been trending upward, evidence that layoffs are rising, this week's number may have been inflated by the President's Day holiday.
    • Oil and Gas Inventories
    • rude oil inventories rose by 3.2 million barrels for the week ending February 22, according to the Energy Information Administration. Expectations were for a buildup of 2.5 million barrels. Distillate supplies fell by 2.5 million barrels, in line with expectations. Gasoline inventories rose by 2.3 million barrels, above expectations of a 0.3 million barrel increase. Refinery operating capacity rose to 84.7% from 83.5%. This report is bearish.
    • Weekly Natural Gas Storage Report
    • Underground storage of natural gas fell by 151 billion cubic feet during the week ending February 22, slightly less than the consensus expectation for a drawdown of 158 billion cubic feet. Total underground storage was 1,619 Bcf as of February 22, 133 Bcf less than a year ago but 87 Bcf above the five-year average for this time of year.

    Source: Economy.com 2008

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