by Calculated Risk on 4/15/2025 11:34:00 AM

Today, in the Calculated Risk Real Estate Newsletter: 3rd Look at Local Housing Markets in March

A brief excerpt:

This is the third look at several early reporting local markets in March. I’m tracking over 40 local housing markets in the US. Some of the 40 markets are states, and some are metropolitan areas. I’ll update these tables throughout the month as additional data is released.

Closed sales in March were mostly for contracts signed in January and February when 30-year mortgage rates averaged 6.96% and 6.84%, respectively (Freddie Mac PMMS). This was an increase from the average rate for homes that closed in February. This was before the recent surge in economic uncertainty and stock market volatility that might impact existing home sales.
...
Here is a look at months-of-supply using NSA sales. Since this is NSA data, it is likely months-of-supply will increase into the Summer.

Months in red are areas that are seeing 5+ months of supply now and might see price pressures later this summer.
...
Many more local markets to come!

There is much more in the article.

Weekly Schedule

by Calculated Risk on 4/15/2025 08:11:00 AM

Eleven years ago, I wrote: Census Bureau: Largest 5-year Population Cohort is now the "20 to 24" Age Group.  Those people are now in the 30 to 34 cohort.

This month the Census Bureau released the population estimates for July 2024 by age, and I've updated the table from the previous posts.

The table below shows the top 10 cohorts by size for 2010, 2024 (just released), and the most recent Census Bureau projections for 2030.

In 2024, the top 6 cohorts were under 45 (the Boomers are fading away), and by 2030 the top 7 cohorts will be under 50.  Note: This is using the 2023 projections main series.  

There will be plenty of "gray hairs" walking around in 2030, but the key for the economy is the large cohorts in the prime working age.

As I noted in 2014, demographics were positive for apartments, and more recently positive for homeownership.

Population: Largest 5-Year Cohorts by Year
Largest Cohorts	2010	2024	2030
1	45 to 49 years	30 to 34 years	35 to 39 years
2	50 to 54 years	35 to 39 years	30 to 34 years
3	15 to 19 years	25 to 29 years	25 to 29 years
4	20 to 24 years	20 to 24 years	40 to 44 years
5	25 to 29 years	15 to 19 years	20 to 24 years
6	40 to 44 years	40 to 44 years	45 to 49 years
7	10 to 14 years	60 to 64 years	15 to 19 years
8	5 to 9 years	10 to 14 years	50 to 54 years
9	Under 5 years	50 to 54 years	65 to 69 years
10	35 to 39 years	55 to 59 years	10 to 14 years

Click on graph for larger image.

This graph, based on the 2024 population estimate, shows the U.S. population by age in July 2024 according to the Census Bureau.

Note that the largest age group is in the early-to-mid 30s.  There are still a number of younger Boomers in their early-to-mid 60s.

by Calculated Risk on 4/14/2025 07:54:00 PM

From Matthew Graham at Mortgage News Daily: Mortgage Rates Fall Back Below 7%

Last Friday was notable in that it was the first day since February 19th where the average top tier 30yr fixed mortgage rate ended the day over 7%. Last week was also notable for ranking among the more abrupt weeks for rising rates over the past few years.

Things are getting off to a friendlier start in the present week with the 30yr fixed rate index edging back below 7%--roughly in line with levels seen last Wed/Thu. [30 year fixed 6.98%]
emphasis added

Tuesday:
• At 8:30 AM ET, The New York Fed Empire State manufacturing survey for April. The consensus is for a reading of -10.0, up from -20.0.

by Calculated Risk on 4/14/2025 02:49:00 PM

From housing economist Tom Lawler: Update on Mortgage/MBS Rates and Spreads

On April 4th, the day after Trump’s “Liberation Day” tariff announcement, the so-called 30-year “current-coupon” MBS yield closed at 5.34%, its lowest level since the middle of last October. Last week’s bond market debacle, however, hit the MBS market especially hard, and the current-coupon MBS yield closed the week at 5.93%, its highest level since the middle of January.

Obviously a major catalyst for the surge in MBS yields was the sharp increase in intermediate- and long-term Treasury rates. Putting additional upward pressure on MBS yields was the surge in market-implied interest-rate volatility. For example, the ICE BofAML MOVE Index, which is a measure of implied interest rate volatility derived from options on Treasury securities across the yield curve, jumped to 137.26 last Friday, its highest level since May 2023 and up sharply from 101.35 at the end of March.

Finally, a widely-followed measure of the CCMBS option-adjusted spread to Treasuries from Yield Book increased by about 12 bp last week.

by Calculated Risk on 4/14/2025 11:16:00 AM

Today, in the Calculated Risk Real Estate Newsletter: Watch Inventory and Why Measures of Existing Home Inventory appear Different

A brief excerpt:

We are in a period of significant policy uncertainty and there isn’t a good historical analog for the current period. However, for housing, the key will be to watch inventory.

Existing home inventory will provide clues on house prices, and a combination of existing and new home inventory will indicate what will happen with housing starts.

Watch Inventory

Here are a few examples of when inventory helped me call some turning points for house prices (this section is an update to a previous article):

Starting in January 2005, I was very bearish on housing, but I wasn’t sure when the market would turn. Speculative bubbles can go on and on. However, the increase in inventory in late 2005 (see red arrow on graph below) helped me call the top for house prices in 2006.

Several years later, in early 2012, when many people were still bearish on housing, the plunge in inventory in 2011 (blue arrow on graph below) helped me call the bottom for house prices in early 2012 (see The Housing Bottom is Here).

There is much more in the article.

by Calculated Risk on 4/14/2025 08:21:00 AM

Altos reports that active single-family inventory was up 2.3% week-over-week.

Inventory is now up 12.5% from the seasonal bottom in January and is increasing.  

Usually, inventory is up about 5% or 6% from the seasonal low by this week in the year.   So, 2025 is seeing a larger than normal pickup in inventory.

The first graph shows the seasonal pattern for active single-family inventory since 2015.

Click on graph for larger image.

The red line is for 2025.  The black line is for 2019.  

Inventory was up 33.4% compared to the same week in 2024 (last week it was up 34.7%), and down 17.5% compared to the same week in 2019 (last week it was down 17.4%). 

Inventory will pass 2020 levels soon, and it now appears inventory will be close to 2019 levels towards the end of 2025.

This second inventory graph is courtesy of Altos Research.

As of April 11th, inventory was at 702 thousand (7-day average), compared to 691 thousand the prior week. 

Mike Simonsen discusses this data regularly on Youtube

by Calculated Risk on 4/13/2025 06:22:00 PM

Weekend:
• Schedule for Week of April 13, 2025

Monday:
• No major economic releases scheduled.

From CNBC: Pre-Market Data and Bloomberg futures S&P 500 are up 48 and DOW futures are up 250 (fair value).

Oil prices were down over the last week with WTI futures at $61.50 per barrel and Brent at $64.76 per barrel. A year ago, WTI was at $86, and Brent was at $93 - so WTI oil prices are down about 28% year-over-year.

Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $3.15 per gallon. A year ago, prices were at $3.60 per gallon, so gasoline prices are down $0.45 year-over-year.

by Calculated Risk on 4/13/2025 08:31:00 AM

The Personal Consumption Expenditures (PCE) price index for March will be released on April 30th. The data released so far suggests the PCE inflation will be soft in March.

From Goldman Sachs economists:

The producer price index (PPI), the PPI excluding food and energy, and the PPI excluding food, energy, and trade were all below consensus expectations in March. The components relevant for core PCE were soft. Based on the details in the PPI and CPI reports, we estimate that the core PCE price index rose 0.08% in March (vs. our expectation of 0.13% before today's PPI report), corresponding to a year-over-year rate of +2.52%.

And from BofA:

[W]e are tracking core PCE to rise by 0.1% m/m (0.08% unrounded) in March. This would be a notable deceleration from the first two months of the year. However, February is likely to be revised up significantly to 0.5% m/m due to a very large upward revision to portfolio management. As a result, we expect y/y core PCE to fall to 2.6% from an upwardly revised 2.9%.

This is further improvement progress on inflation.  If policy had remained unchanged, we'd probably be celebrating a "soft landing".  However, the tariffs will likely impact prices in May (the data will be released in June).

by Calculated Risk on 4/12/2025 02:11:00 PM

At the Calculated Risk Real Estate Newsletter this week:

Click on graph for larger image.

• Part 1: Current State of the Housing Market; Overview for mid-April 2025

• Part 2: Current State of the Housing Market; Overview for mid-April 2025

• 2nd Look at Local Housing Markets in March

• ICE Mortgage Monitor: Home Prices Continue to Cool

• 1st Look at Local Housing Markets in March

This is usually published 4 to 6 times a week and provides more in-depth analysis of the housing market.

by Calculated Risk on 4/12/2025 08:11:00 AM

The key reports this week are March Retail Sales and Housing Starts.

For manufacturing, the March Industrial Production report, and NY and Philly Fed surveys will be released this week.

Fed Chair Jerome Powell speaks on Wednesday.

----- Monday, April 14th -----
No major economic releases scheduled.

----- Tuesday, April 15th -----
8:30 AM: The New York Fed Empire State manufacturing survey for April. The consensus is for a reading of -10.0, up from -20.0.

----- Wednesday, April 16th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

8:30 AM: Retail sales for March is scheduled to be released.  The consensus is for a 1.3% increase in retail sales. 

This graph shows the year-over-year change in retail sales and food service (ex-gasoline) since 1993. 

9:15 AM: The Fed will release Industrial Production and Capacity Utilization for March.

This graph shows industrial production since 1967.

The consensus is for a 0.3% decrease in Industrial Production, and for Capacity Utilization to decrease to 77.9%.

10:00 AM: The April NAHB homebuilder survey. The consensus is for a reading of 38, down from 39.  Any number below 50 indicates that more builders view sales conditions as poor than good.

1:30 PM: Speech, Fed Chair Jerome Powell, Economic Outlook, At the Economic Club of Chicago, Chicago, Ill.

----- Thursday, April 17th -----
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for 224 initial claims up from 223 thousand last week.

8:30 AM ET: Housing Starts for March.

This graph shows single and multi-family housing starts since 1968.

The consensus is for 1.410 million SAAR, down from 1.501 million SAAR in February.

8:30 AM: the Philly Fed manufacturing survey for April. The consensus is for a reading of 6.7, down from 12.5.

----- Friday, April 18th -----
All US markets will be closed in observance of Good Friday.

10:00 AM: State Employment and Unemployment (Monthly) for March 2025