by Calculated Risk on 6/01/2025 08:21:00 AM

This is something to watch again. Here is another monthly update on lumber prices.

SPECIAL NOTE: The CME group discontinued the Random Length Lumber Futures contract on May 16, 2023.  I switched to a physically-delivered Lumber Futures contract that was started in August 2022.  Unfortunately, this impacts long term price comparisons since the new contract was priced about 24% higher than the old random length contract for the period when both contracts were available.

This graph shows CME random length framing futures through August 2022 (blue), and the new physically-delivered Lumber Futures (LBR) contract starting in August 2022 (Red).

On May 30, 2025, LBR was at $593.00 per 1,000 board feet, up 17% from a year ago.

Click on graph for larger image.

There is somewhat of a seasonal demand for lumber, and lumber prices frequently peak in the first half of the year.

Last year, prices bottomed in July at $449.00 per 1,000 board feet.

Note that the pickup in early 2018 was due to the Trump lumber tariffs in 2017.  There were huge increases during the pandemic due to a combination of supply constraints and a pickup in housing starts.

The recent year-over-year increase might be due to the tariffs.  

by Calculated Risk on 5/31/2025 02:11:00 PM

At the Calculated Risk Real Estate Newsletter this week:

Click on graph for larger image.

• Case-Shiller: National House Price Index Up 3.4% year-over-year in March

• Inflation Adjusted House Prices 1.0% Below 2022 Peak

• Freddie Mac House Price Index Declined in April; Up 2.6% Year-over-year

• Final Look at Local Housing Markets in April and a Look Ahead to May Sales

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

by Calculated Risk on 5/31/2025 08:11:00 AM

The key report scheduled for this week is the May employment report.

Other key reports include the May ISM Manufacturing, Vehicle Sales and April trade balance.

----- Monday, June 2nd -----
10:00 AM: ISM Manufacturing Index for May. The consensus is for the ISM to be at 49.2, up from 48.7 in April.

10:00 AM: Construction Spending for April. The consensus is for a 0.4% increase in construction spending.

1:00 PM: Speech, Fed Chair Jerome Powell, Opening Remarks, At the Federal Reserve Board’s International Finance Division 75th Anniversary Conference, Washington, D.C.

----- Tuesday, June 3rd -----
10:00 AM ET: Job Openings and Labor Turnover Survey for April from the BLS.

This graph shows job openings (black line), hires (purple), Layoff, Discharges and other (red column), and Quits (light blue column) from the JOLTS.

Jobs openings decreased in March to 7.19 million from 7.48 million in February. The number of job openings (black) were down 11% year-over-year.

Quits were unchanged year-over-year.

Late: Light vehicle sales for May.

The consensus is for light vehicle sales to be 16.4 million SAAR in May, down from 17.3 million in April (Seasonally Adjusted Annual Rate).

This graph shows light vehicle sales since the BEA started keeping data in 1967. The dashed line is the sales rate for last month.

----- Wednesday, June 4th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

8:15 AM: The ADP Employment Report for May. This report is for private payrolls only (no government). The consensus is for 120,000 payroll jobs added in May, up from 62,000 in April.

10:00 AM: the ISM Services Index for May.   The consensus is for a reading of 52.0, up from 51.6.

----- Thursday, June 5th -----
8:30 AM: Trade Balance report for April from the Census Bureau.

This graph shows the U.S. trade deficit, with and without petroleum. 

The blue line is the total deficit, and the black line is the petroleum surplus, and the red line is the trade deficit ex-petroleum products.

The consensus is the trade deficit to be $117.3 billion.  The U.S. trade deficit was at $140.5 Billion in March.

8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for initial claims of 230 thousand, down from 240 thousand last week.

----- Friday, June 6th -----
8:30 AM: Employment Report for May.   The consensus is for 130,000 jobs added, and for the unemployment rate to be unchanged at 4.2%.

There were 177,000 jobs added in April, and the unemployment rate was at 4.2%.

This graph shows the jobs added per month since January 2021.

by Calculated Risk on 5/30/2025 07:39:00 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	267✅	310	≤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 2020.

Although weekly deaths met the original goal to stop posting in June 2024 (previous pandemic low of 314 deaths), I've continued to post since deaths moved above the goal again - and I'll continue to post until weekly deaths are below the goal for several weeks.

And here is a graph I'm following concerning COVID in wastewater as of May 29th:

This appears to be a leading indicator for COVID hospitalizations and deaths.  This is close to the lows of May 2024.

Nationally COVID in wastewater is "Very Low".

by Calculated Risk on 5/30/2025 02:09:00 PM

From BofA:

Since our last weekly publication, our 2Q GDP tracking is down two-tenths to +1.8% q/q saar. [May 30th estimate]
emphasis added

From Goldman:

The goods trade deficit narrowed by more than expected in April, reflecting a sharp decline in goods imports and a moderate increase in goods exports. The Advance Economic Indicators report indicated a significantly larger decline in imports than our previous GDP tracking assumptions, while the details of the personal income and spending report were modestly softer than our previous assumptions. On net, we boosted our Q2 GDP tracking estimate by 1.0pp to +3.3% (quarter-over-quarter annualized). Our Q2 domestic final sales estimate stands at -0.6%. We continue to see the headline Q1 and Q2 GDP growth readings as distorted measures of economic growth because of measurement challenges related to swings in imports around tariff increases. [May 30th estimate]

And from the Atlanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2025 is 3.8 percent on May 30, up from 2.2 percent on May 27. After recent releases from the US Census Bureau and the US Bureau of Economic Analysis, the nowcast of the contribution of net exports to second-quarter real GDP growth increased from -0.64 percentage points to 1.45 percentage points, while the nowcasts of second-quarter real personal consumption expenditures growth and second-quarter real gross private domestic investment growth declined from 3.7 percent and -0.2 percent, respectively, to 3.3 percent and -1.4 percent. [May 30th estimate]

by Calculated Risk on 5/30/2025 01:10:00 PM

From STR: U.S. hotel results for week ending 24 May

The U.S. hotel industry reported mixed year-over-year comparisons, according to CoStar’s latest data through 24 May. ...

18-24 May 2025 (percentage change from comparable week in 2024):

• Occupancy: 67.5% (-0.4%)
• Average daily rate (ADR): US$164.57 (+1.5%)
• Revenue per available room (RevPAR): US$111.02 (+1.1%)
emphasis added

The following graph shows the seasonal pattern for the hotel occupancy rate using the four-week average.

Click on graph for larger image.

The red line is for 2025, blue is the median, and dashed light blue is for 2024.  Dashed purple is for 2018, the record year for hotel occupancy. 

The 4-week average of the occupancy rate is tracking last year and above the median rate for the period 2000 through 2024 (Blue).

Note: Y-axis doesn't start at zero to better show the seasonal change.

The 4-week average will mostly move sideways for a couple more weeks until the summer travel season.  We will likely see a hit to occupancy during the summer months due to less international tourism.

by Calculated Risk on 5/30/2025 10:09:00 AM

Today, in the Calculated Risk Real Estate Newsletter: Freddie Mac House Price Index Declined in April; Up 2.6% Year-over-year

A brief excerpt:

Freddie Mac reported that its “National” Home Price Index (FMHPI) decreased -0.15% month-over-month (MoM) on a seasonally adjusted (SA) basis in April. On a year-over-year basis, the National FMHPI was up 2.6% in April, down from up 2.9% YoY in March. The YoY increase peaked at 19.0% in July 2021, and for this cycle, bottomed at up 0.9% YoY in April 2023. ...

As of April, 26 states and D.C. were below their previous peaks, Seasonally Adjusted. The largest seasonally adjusted declines from the recent peaks are in D.C. (-5.3), Colorado (-2.4%), Oregon (-2.0%), Montana (-1.7%) and Florida (-1.7%).

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 5 cities with the largest price declines are in Florida.

There is much more in the article!

by Calculated Risk on 5/30/2025 08:53:00 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 April 2025.

CPI Shelter was up 4.0% year-over-year in April, unchanged from 4.0% in March, and down from the cycle peak of 8.2% in March 2023.

Housing (PCE) was up 4.2% YoY in April, down from 4.3% in March 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. 

3-month annualized change:

PCE Price Index: 2.1%
Core PCE Prices: 2.7%
Core minus Housing: 2.4%

Note: It is likely there is still some residual seasonality distorting PCE prices in Q1.

by Calculated Risk on 5/30/2025 08:30:00 AM

From the BEA: Personal Income and Outlays, April 2025

Personal income increased $210.1 billion (0.8 percent at a monthly rate) in April, according to estimates released today by the U.S. Bureau of Economic Analysis. Disposable personal income (DPI)—personal income less personal current taxes—increased $189.4 billion (0.8 percent) and personal consumption expenditures (PCE) increased $47.8 billion (0.2 percent).

Personal outlays—the sum of PCE, personal interest payments, and personal current transfer payments—increased $48.6 billion in April. Personal saving was $1.12 trillion in April and the personal saving rate—personal saving as a percentage of disposable personal income—was 4.9 percent.

From the preceding month, the PCE price index for April increased 0.1 percent. Excluding food and energy, the PCE price index also increased 0.1 percent.

From the same month one year ago, the PCE price index for April increased 2.1 percent. Excluding food and energy, the PCE price index increased 2.5 percent from one year ago.
emphasis added

The April PCE price index increased 2.1 percent year-over-year (YoY), down from 2.3 percent YoY in March, and down from the recent peak of 7.2 percent in June 2022.

The PCE price index, excluding food and energy, increased 2.5 percent YoY, down from 2.6 percent the previous month, and down from the recent peak of 5.6 percent in February 2022.

The following graph shows real Personal Consumption Expenditures (PCE) through April 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 above expectations and PCE were at expectations.

Inflation was slightly below expectations.

by Calculated Risk on 5/29/2025 07:21:00 PM

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

Friday:
• At 8:30 AM ET, Personal Income and Outlays, April 2025. 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 0.1%.  PCE prices are expected to be up 2.2% YoY, and core PCE prices up 2.5% YoY.

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

• At 10:00 AM: University of Michigan's Consumer sentiment index (Final for May). The consensus is for a reading of 50.8.