by Calculated Risk on 2/28/2025 07:03:00 PM

Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.

For deaths, I'm currently using 4 weeks ago for "now", since the most recent three weeks will be revised significantly.

Note: "Effective May 1, 2024, hospitals are no longer required to report COVID-19 hospital admissions, hospital capacity, or hospital occupancy data."  So I'm no longer tracking hospitalizations.

COVID Metrics
	Now	Week Ago	Goal
Deaths per Week	850	893	≤3501
1my goals to stop weekly posts. 🚩 Increasing number weekly for Deaths. ✅ Goal met.

Click on graph for larger image.

This graph shows the weekly (columns) number of deaths reported since Jan 2023.

Although weekly deaths met the original goal to stop posting in June 2023 (low of 314 deaths), I'm continuing to post now that deaths are above the goal again - and I'll continue to post until weekly deaths are once again below the goal.

Weekly deaths are now decreasing following the winter pickup.

And here is a graph I'm following concerning COVID in wastewater as of February 27th:

This appears to be a leading indicator for COVID hospitalizations and deaths.  This has moving down recently.

Nationally COVID in wastewater is "Moderate", down from "High" two weeks ago, according to the CDC.   

by Calculated Risk on 2/28/2025 11:49:00 AM

From BofA:

The second print of 4Q GDP came in at 2.3% q/q saar, unchanged from the advance print and a tenth higher than our tracking estimate. Meanwhile, our 1Q GDP tracking is unchanged at 2.3% q/q saar since our last weekly publication. [Feb 28th]
emphasis added

From Goldman:

We lowered our Q1 GDP tracking estimate by 0.4pp to +1.4% (quarter-over-quarter annualized). Our tracking estimate exaggerates the softness in Q1 to some extent because elevated gold imports ought to result in an offsetting increase in inventory accumulation, but the Q4 GDP data suggest this offset is unlikely to be captured in real time. [Feb 28th estimate]

And from the Atlanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2025 is -1.5 percent on February 28, down from 2.3 percent on February 19. After recent releases from the US Bureau of Economic Analysis and the US Census Bureau, the nowcast of the contribution of net exports to first-quarter real GDP growth fell from -0.41 percentage points to -3.70 percentage points while the nowcast of first-quarter real personal consumption expenditures growth fell from 2.3 percent to 1.3 percent. [Feb 28th estimate]

by Calculated Risk on 2/28/2025 10:47:00 AM

Today, in the Calculated Risk Real Estate Newsletter: Freddie Mac House Price Index Increased in January; Up 3.9% Year-over-year

A brief excerpt:

Freddie Mac reported that its “National” Home Price Index (FMHPI) increased 0.41% month-over-month on a seasonally adjusted (SA) basis in January. On a year-over-year basis, the National FMHPI was up 3.9% in January, down from up 4.1% YoY in December. The YoY increase peaked at 19.0% in July 2021, and for this cycle, bottomed at up 0.9% YoY in May 2023. ...

For cities (Core-based Statistical Areas, CBSA), here are the 30 cities with the largest declines from the peak, seasonally adjusted. Austin continues to be the worst performing city. However, 4 of the 6 cities with the largest price declines are in Florida (and Florida has 6 of the top 10 cities with the largest price declines).

There is much more in the article!

by Calculated Risk on 2/28/2025 08:57:00 AM

Here is a graph of the year-over-year change in shelter from the CPI report and housing from the PCE report this morning, both through January 2025.

CPI Shelter was up 4.4% year-over-year in January, down from 4.6% in December, and down from the cycle peak of 8.2% in March 2023.

Housing (PCE) was up 4.5% YoY in January, down from 4.7% in December and down from the cycle peak of 8.3% in April 2023.

Since asking rents are mostly flat year-over-year, these measures will slowly continue to decline over the next year as rents for existing tenants continue to increase.

The second graph shows PCE prices, Core PCE prices and Core ex-housing over the last 3 months (annualized):

Key measures are slightly above the Fed's target on a 3-month basis. Note: There is possibly some residual seasonality distorting PCE prices in Q1, especially in January.

3-month annualized change:

PCE Price Index: 2.9%
Core PCE Prices: 2.4%
Core minus Housing: 2.1%

by Calculated Risk on 2/28/2025 08:30:00 AM

The BEA released the Personal Income and Outlays, January 2025 report for January:

Personal income increased $221.9 billion (0.9 percent at a monthly rate) in January, according to estimates released today by the U.S. Bureau of Economic Analysis. Disposable personal income (DPI)—personal income less personal current taxes—increased $194.3 billion (0.9 percent) and personal consumption expenditures (PCE) decreased $30.7 billion (0.2 percent).

Personal outlays—the sum of PCE, personal interest payments, and personal current transfer payments—decreased $52.7 billion in January. Personal saving was $1.01 trillion in January and the personal saving rate—personal saving as a percentage of disposable personal income—was 4.6 percent.
...
From the preceding month, the PCE price index for January increased 0.3 percent. Excluding food and energy, the PCE price index increased 0.3 percent.
emphasis added

The January PCE price index increased 2.5 percent year-over-year (YoY), down from 2.6 percent YoY in December, and down from the recent peak of 7.0 percent in June 2022.

The PCE price index, excluding food and energy, increased 2.6 percent YoY, down from 2.9 percent in December, and down from the recent peak of 5.4 percent in February 2022.

The following graph shows real Personal Consumption Expenditures (PCE) through January 2025 (2017 dollars). Note that the y-axis doesn't start at zero to better show the change.

Click on graph for larger image.

The dashed red lines are the quarterly levels for real PCE.

Personal income was well above expectations, and PCE was below expectations.

Inflation was close to expectations.

by Calculated Risk on 2/27/2025 07:23:00 PM

Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.

Friday:
• At 8:30 AM ET, Personal Income and Outlays for January. The consensus is for a 0.3% increase in personal income, and for a 0.2% increase in personal spending. And for the Core PCE price index to increase 0.2%.  PCE prices are expected to be up 2.5% YoY, and core PCE prices up 2.6% YoY.

• At 9:45 AM, Chicago Purchasing Managers Index for February.

by Calculated Risk on 2/27/2025 04:01:00 PM

What this means: On a weekly basis, Realtor.com reports the year-over-year change in active inventory and new listings. On a monthly basis, they report total inventory. For February, Realtor.com reported inventory was up 27.5% YoY, but still down 22.9% compared to the 2017 to 2019 same month levels. 

 Now - on a weekly basis - inventory is up 27.7% YoY.

Realtor.com has monthly and weekly data on the existing home market. Here is their weekly report: Weekly Housing Trends View—Data for Week Ending Feb. 22, 2025

• Active inventory increased, with for-sale homes 27.7% above year-ago levels

The number of homes for sale has now been higher than the previous year for 68 consecutive weeks. This continued rise in active inventory suggests that homes are not only being listed at a higher rate but are also lingering on the market longer. With more choices available, buyers can afford to be more selective, putting pressure on sellers to price competitively.

• New listings—a measure of sellers putting homes up for sale—increased 2.5%

Newly listed inventory grew for the seventh consecutive week, signaling that sellers are gaining confidence in listing their homes despite persistently high mortgage rates. While this week’s increase is slightly smaller than the previous week, the steady influx of fresh inventory offers buyers more options as the market heads into the spring season.

Here is a graph of the year-over-year change in inventory according to realtor.com. 

Inventory was up year-over-year for the 68th consecutive week.  

New listings have increased recently but remain below typical pre-pandemic levels.

by Calculated Risk on 2/27/2025 12:53:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Inflation Adjusted House Prices 1.0% Below 2022 Peak

Excerpt:

It has been over 18 years since the housing bubble peak. In the December Case-Shiller house price index released this week, the seasonally adjusted National Index (SA), was reported as being 77% above the bubble peak in 2006. However, in real terms, the National index (SA) is about 12% above the bubble peak (and historically there has been an upward slope to real house prices). The composite 20, in real terms, is 3% above the bubble peak.

People usually graph nominal house prices, but it is also important to look at prices in real terms. As an example, if a house price was $300,000 in January 2010, the price would be $438,000 today adjusted for inflation (46% increase). That is why the second graph below is important - this shows "real" prices.

The third graph shows the price-to-rent ratio, and the fourth graph is the affordability index. The last graph shows the 5-year real return based on the Case-Shiller National Index.
...
The second graph shows the same two indexes in real terms (adjusted for inflation using CPI).

In real terms (using CPI), the National index is 1.0% below the recent peak, and the Composite 20 index is 1.2% below the recent peak in 2022. The real National index and the Composite 20 index increased slightly in real terms in December.

It has now been 31 months since the real peak in house prices. Typically, after a sharp increase in prices, it takes a number of years for real prices to reach new highs (see House Prices: 7 Years in Purgatory)

There is much more in the article!

by Calculated Risk on 2/27/2025 10:00:00 AM

From the NAR: Pending Home Sales Waned 4.6% in January

Pending home sales pulled back 4.6% in January according to the National Association of REALTORS®. The Midwest, South and West experienced month-over-month losses in transactions – with the most significant drop in the South – while the Northeast saw a modest gain. Year-over-year, contract signings lowered in all four U.S. regions, with the South seeing the greatest falloff.

The Pending Home Sales Index (PHSI)* – a forward-looking indicator of home sales based on contract signings – fell 4.6% to 70.6 in January, an all-time low. (Last year's cyclical low point in July 2024 was revised from 70.2 to 71.2.) Year-over-year, pending transactions declined 5.2%. An index of 100 is equal to the level of contract activity in 2001.

"It is unclear if the coldest January in 25 years contributed to fewer buyers in the market, and if so, expect greater sales activity in upcoming months," said NAR Chief Economist Lawrence Yun. "However, it's evident that elevated home prices and higher mortgage rates strained affordability."
...
The Northeast PHSI rose 0.3% from last month to 63.4, down 0.5% from January 2024. The Midwest index contracted 2.0% to 72.8 in January, down 2.7% from the previous year.

The South PHSI plunged 9.2% to 81.0 in January, down 8.8% from a year ago. The West in
emphasis added

Note: Contract signings usually lead sales by about 45 to 60 days, so this would usually be for closed sales in February and March.

by Calculated Risk on 2/27/2025 08:36:00 AM

From the BEA: Gross Domestic Product, 4th Quarter and Year 2024 (Second Estimate)

Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the fourth quarter of 2024 (October, November, and December), according to the second estimate released by the U.S. Bureau of Economic Analysis. In the third quarter, real GDP increased 3.1 percent.

The increase in real GDP in the fourth quarter primarily reflected increases in consumer spending and government spending that were partly offset by a decrease in investment. Imports, which are a subtraction in the calculation of GDP, decreased. ... Real GDP was revised up by less than 0.1 percentage point from the advance estimate released last month, primarily reflecting upward revisions to government spending and exports that were partly offset by downward revisions to consumer spending and investment.
emphasis added

Here is a Comparison of Second and Advance Estimates. PCE growth was unrevised at 4.2%. Residential investment was revised up from 5.3% to 5.4%.