by Calculated Risk on 9/25/2025 02:40:00 PM

Hotel occupancy was weak over the summer months, due to less international tourism.  The fall months are mostly domestic travel and occupancy is still down year-over-year.

From STR: U.S. hotel results for week ending 20 September

The U.S. hotel industry reported negative year-over-year comparisons, according to CoStar’s latest data through 20 September. ...

14-20 September 2025 (percentage change from comparable week in 2024):

• Occupancy: 68.1% (-1.1%)
• Average daily rate (ADR): US$168.98 (-0.3%)
• Revenue per available room (RevPAR): US$115.12 (-1.4%)
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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 behind both last year and 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 increase during the Fall travel period.

On a year-to-date basis, the only worse years for occupancy over the last 25 years were pandemic or recession years.

by Calculated Risk on 9/25/2025 10:54:00 AM

Today, in the CalculatedRisk Real Estate Newsletter: NAR: Existing-Home Sales Decreased to 4.00 million SAAR in August

Excerpt:

The fourth graph shows existing home sales by month for 2024 and 2025.

Sales were up 1.8% year-over-year compared to August 2024. Next month will also have an easy year-over-year comparison.
...
On an NSA basis for the month of August, this was 7% above the low for housing bust for the month of August that happened in August 2010. Year-to-date, sales are down 1.2% NSA.

There is much more in the article.

by Calculated Risk on 9/25/2025 10:00:00 AM

From the NAR: NAR Existing-Home Sales Report Shows 0.2% Decrease in August

• 0.2% decrease in total existing-home sales1 month-over-month to a seasonally adjusted annual rate of 4.0 million.

• 1.8% increase in sales year-over-year.

• 1.53 million units: Total housing inventory, down 1.3% from July and up 11.7% from August 2024 (1.37 million).

• 4.6-month supply of unsold inventory, no change from July and up from 4.2 months in August 2024.

• $422,600: Median existing-home price3 for all housing types, up 2.0% from one year ago ($414,200) – the 26th consecutive month of year-over-year price increases.
emphasis added

Click on graph for larger image.

This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1994.

Sales in August (4.00 million SAAR) were down 0.2% from the previous month and were up 1.8% compared to the August 2024 sales rate.  

The second graph shows nationwide inventory for existing homes.

According to the NAR, inventory decreased to 1.53 million in August from 1.55 million the previous month.

Headline inventory is not seasonally adjusted, and inventory usually decreases to the seasonal lows in December and January, and peaks in mid-to-late summer.

The last graph shows the year-over-year (YoY) change in reported existing home inventory and months-of-supply. Since inventory is not seasonally adjusted, it really helps to look at the YoY change. Note: Months-of-supply is based on the seasonally adjusted sales and not seasonally adjusted inventory.

Inventory was up 11.7% year-over-year (blue) in August compared to August 2024.

Months of supply (red) was unchanged at 4.6 months in August from 4.6 months the previous month.

I'll have more later. 

by Calculated Risk on 9/25/2025 08:42:00 AM

From the BEA: Gross Domestic Product, 2nd Quarter 2025 (Third Estimate), GDP by Industry, Corporate Profits (Revised), and Annual Update

Real gross domestic product (GDP) increased at an annual rate of 3.8 percent in the second quarter of 2025 (April, May, and June), according to the third estimate released by the U.S. Bureau of Economic Analysis. In the first quarter, real GDP decreased 0.6 percent (revised).

The increase in real GDP in the second quarter primarily reflected a decrease in imports, which are a subtraction in the calculation of GDP, and an increase in consumer spending. These movements were partly offset by decreases in investment and exports.

Real GDP was revised up 0.5 percentage point from the second estimate, primarily reflecting an upward revision to consumer spending.
emphasis added

Here is a Comparison of Third and Second Estimates. PCE growth was revised up from 1.6% to 2.5%. Residential investment was revised down from -4.7% to -5.1%.

by Calculated Risk on 9/25/2025 08:30:00 AM

The DOL reported:

In the week ending September 20, the advance figure for seasonally adjusted initial claims was 218,000, a decrease of 14,000 from the previous week's revised level. The previous week's level was revised up by 1,000 from 231,000 to 232,000. The 4-week moving average was 237,500, a decrease of 2,750 from the previous week's revised average. The previous week's average was revised up by 250 from 240,000 to 240,250.
emphasis added

The following graph shows the 4-week moving average of weekly claims since 1971.

Click on graph for larger image.

The dashed line on the graph is the current 4-week average. The four-week average of weekly unemployment claims decreased to 237,500.

The previous week was revised up.

Weekly claims were well below the consensus forecast.

by Calculated Risk on 9/24/2025 08:52:00 PM

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

Thursday:
• At 8:30 AM ET, The initial weekly unemployment claims report will be released. The consensus is for initial claims to increase to 234 thousand from 231 thousand last week.

• At 8:30 AM, Gross Domestic Product, 2nd Quarter 2025 (Third Estimate), GDP by Industry, and Corporate Profits (Revised) The consensus is that real GDP increased 3.3% annualized in Q2, unchanged from the second estimate of 3.3%.

• At 8:30 AM, Durable Goods Orders for August from the Census Bureau. The consensus is for a 0.5% decrease in durable goods orders.

• At 10:00 AM, Existing Home Sales for August from the National Association of Realtors (NAR). The consensus is for 3.98 million SAAR, down from 4.01 million in July.

Housing economist Tom Lawler expects the NAR to report August sales of 3.93 million SAAR.

• At 11:00 AM, the Kansas City Fed manufacturing survey for September.

by Calculated Risk on 9/24/2025 04:50:00 PM

Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment including multi-family residential.

From the AIA: ABI August 2025: Softness persists at architecture firms

The AIA/Deltek Architecture Billings Index (ABI) score was 47.2 for the month of August 2025. The share of firms reporting declining billings in August fell modestly from July, but overall, most firms continue to report a downward trajectory. In addition, inquiries softened in August and were essentially flat, after small increases over the previous three months. In addition, the value of new design contracts declined for the 18th consecutive month, the longest period of decline since we started collecting this data 15 years ago. This year has seen generally soft inquiries into new projects and a steady decrease in the value of newly signed design contracts, as clients remain cautious about committing to new projects. Without new work on the horizon, many firms will likely continue to experience declining billings in the coming months.

While business conditions remained soft at firms in most regions of the country in August, firms located in the South reported essentially flat conditions for the fourth consecutive month. In contrast, firms located in the West saw their billings soften this month, as they reported their weakest conditions in nearly two years. By specialization, firms with a commercial/industrial specialization reported modest growth in August for the first time in three years. And firms with a multifamily residential specialization have also seen improving conditions in the last few months and saw essentially flat billings this month. In contrast, business conditions have softened recently at firms with an institutional specialization to their lowest levels since 2020. Uncertainty with government budgets in recent months continues to cause uncertainty for many firms specializing in institutional facilities.
...
The ABI serves as a leading economic indicator that leads nonresidential construction activity by approximately 9-12 months.
emphasis added

• Northeast (46.2); Midwest (48.0); South (49.9); West (43.5)

• Sector index breakdown: commercial/industrial (50.8); institutional (44.5); multifamily residential (49.9)

Click on graph for larger image.

This graph shows the Architecture Billings Index since 1996. The index was at 47.2 in August, up from 46.2 in July.  Anything below 50 indicates a decrease in demand for architects' services.

This index has indicated contraction for 33 of the last 35 months.

Note: This includes commercial and industrial facilities like hotels and office buildings, multi-family residential, as well as schools, hospitals and other institutions.

This index usually leads CRE investment by 9 to 12 months, so this index suggests a slowdown in CRE investment throughout 2025 and into 2026.

Multi-family billings have been below 50 for 37 consecutive months.  This suggests we will some further weakness in multi-family starts.

by Calculated Risk on 9/24/2025 02:16:00 PM

From Intercontinental Exchange: ICE First Look at Mortgage Performance: Delinquencies Up on Calendar Effect; Foreclosure Activity Slowly Trending Higher

Intercontinental Exchange, Inc. (NYSE:ICE) ... today released its August 2025 ICE First Look at mortgage delinquency, foreclosure and prepayment trends. The data shows the national delinquency rate rose in August, largely driven by a calendar anomaly, while foreclosure activity continued its slow upward trend.

“The rise in the national delinquency rate for August is best understood in the context of how the calendar can impact payment processing,” said Andy Walden, Head of Mortgage and Housing Market Research at ICE. “Most of the uptick in the national delinquency rate can be attributed to delayed processing of end-of-month payments, as August closed on a Sunday this year. This calendar-driven effect is consistent with what we observed in prior years, so the increase should be considered a temporary adjustment rather than a shift in underlying borrower health.”

Key takeaways from the ICE First Look include:

• The national delinquency rate rose by 16 basis points (bps) in August to 3.43%, up 10 bps from the same time last year, marking a return to annual increases after temporary reprieves in June and July.

• Mortgage delinquencies typically face little seasonal pressure from July to August, but the last day of August 2025 falling on a Sunday resulted in delayed processing and temporarily higher delinquency rolls. For instance, August 2003, 2008, and 2014 also ended on a Sunday, each experiencing a delinquency rise averaging 5.3%. This is similar to the 5.0% rise observed this year – suggesting that much of August’s delinquency rise may have been driven by the way the calendar fell.

• FHA loans continue to see the largest annual increases, with the non-current rate (delinquencies including foreclosures) up by 86 bps to 12.0% in August, while the non-current rates for VA, GSE, and portfolio-held mortgages remained effectively flat year over year.

• Serious delinquencies (loans 90+ days past due but not in foreclosure) rose by 16,000 in August and are up 32,000 year over year, while loans in active foreclosure increased by 3,000 for the month and 23,000 since last year.

• Foreclosure starts rose year-over-year (+6%) for the ninth consecutive month, and foreclosure sales (+22.5%) are up from the same time last year for the sixth consecutive month, contributing to a 12.3% annual increase in foreclosure inventory.

• Inflows and transitions to later stages of delinquency increased across the board, while cures to current from both early- and late-stage delinquency fell.

• August prepayment activity slipped by 1 bp to a 0.66% single month mortality (SMM) rate, reflecting seasonal home buying patterns and relatively steady interest rates in July.
emphasis added

Click on graph for larger image.

Here is a table from ICE.

by Calculated Risk on 9/24/2025 10:59:00 AM

Today, in the Calculated Risk Real Estate Newsletter: New Home Sales increased to 800,000 Annual Rate in August

Brief excerpt:

The Census Bureau reported New Home Sales in August were at a seasonally adjusted annual rate (SAAR) of 800 thousand. The previous three months were revised up, combined.
...
The next graph shows new home sales for 2024 and 2025 by month (Seasonally Adjusted Annual Rate). Sales in August 2025 were up 15.4% from August 2024.

There is much more in the article.

by Calculated Risk on 9/24/2025 10:00:00 AM

The Census Bureau reports New Home Sales in August were at a seasonally adjusted annual rate (SAAR) of 800 thousand.

The previous three months were revised up, combined.

Sales of new single-family houses in August 2025 were at a seasonally-adjusted annual rate of 800,000, according to estimates released jointly today by the U.S. Census Bureau and the Department of Housing and Urban Development. This is 20.5 percent above the July 2025 rate of 664,000, and is 15.4 percent above the August 2024 rate of 693,000.
emphasis added

Click on graph for larger image.

The first graph shows New Home Sales vs. recessions since 1963. The dashed line is the current sales rate.

New home sales were above pre-pandemic levels.

The second graph shows New Home Months of Supply.

The months of supply was decreased in August to 7.4 months from 9.0 months in July.

The all-time record high was 12.2 months of supply in January 2009. The all-time record low was 3.3 months in August 2020.

This is above the top of the normal range (about 4 to 6 months of supply is normal).

"The seasonally-adjusted estimate of new houses for sale at the end of August 2025 was 490,000. This is 1.4 percent below the July 2025 estimate of 497,000, and is 4.0 percent above the August 2024 estimate of 471,000.

This represents a supply of 7.4 months at the current sales rate. The months' supply is 17.8 percent below the July 2025 estimate of 9.0 months, and is 9.8 percent below the August 2024 estimate of 8.2 months."

Sales were well above expectations of 653 thousand SAAR and sales for the three previous months were revised up, combined. I'll have more later today.