by Calculated Risk on 10/23/2025 10:00:00 AM

From the NAR: NAR Existing-Home Sales Report Shows 1.5% Increase in September

Month-over-month

• 1.5% increase in existing-home sales – seasonally adjusted annual rate of 4.06 million in September

• 1.3% increase in unsold inventory – 1.55 million units equal to 4.6 months' supply

Year-over-year

• 4.1% increase in existing-home sales

• 2.1% increase in median existing-home sales price to $415,200
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 September (4.06 million SAAR) were up 1.5% from the previous month and were up 4.1% compared to the September 2024 sales rate.  

The second graph shows nationwide inventory for existing homes.

According to the NAR, inventory increased to 1.55 million in September from 1.53 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 14.0% year-over-year (blue) in September compared to September 2024.

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

I'll have more later. 

by Calculated Risk on 10/22/2025 07:49:00 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. (WILL NOT BE RELEASED)

• At 8:30 AM, Chicago Fed National Activity Index for September. This is a composite index of other data.

• At 10:00 AM, Existing Home Sales for September from the National Association of Realtors (NAR). The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR. 

Housing economist Tom Lawler expects the NAR to report sales of 4.00 million SAAR for September.

• At 11:00 AM, Kansas City Fed Survey of Manufacturing Activity for October.<

by Calculated Risk on 10/22/2025 03:46:00 PM

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

From the AIA: ABI September 2025: Weakness persists at architecture firms

The AIA/Deltek Architecture Billings Index (ABI) score of 43.3 for the month is the softest reading since April and represents an increase in the share of firms reporting a decrease from August. In addition, inquiries into new projects remained flat for the second consecutive month, following growth over the summer, and the value of newly signed design contracts decreased for the 19th consecutive month. All of these indicators mean that the soft conditions that many architecture firms have been experiencing since late 2022 are likely to persist for the foreseeable future.

Recent revisions to work in the pipeline continue to erode as well. In the aftermath of the pandemic-induced downturn in 2020, architecture firm backlogs reached the highest levels we have seen since we started collecting that data regularly 15 years ago. Backlogs have gradually declined since the third quarter of 2022 and currently stand at an average of 6.1 months, down from 6.5 months at the beginning of the year. Backlogs are averaging just five months at firms with multifamily residential and commercial/industrial specializations, but stand at an average of eight months at firms with an institutional specialization. But despite the recent decrease in backlogs at firms, they still stand at levels nearly comparable to those before the pandemic.

Billings declined at firms in all regions of the country in September, except for firms located in the Midwest, where billings were essentially flat. Billings were softest at firms located in the West for the fourth consecutive month, where they have weakened the most over the last year. By firm specialization, business conditions were weakest at firms with an institutional specialization this month and continued to soften at firms with a commercial/industrial specialization, which reported conditions approaching growth over the summer.
...
The ABI serves as a leading economic indicator that leads nonresidential construction activity by approximately 9-12 months.
emphasis added

• Northeast (43.8); Midwest (49.8); South (47.9); West (40.6)

• Sector index breakdown: commercial/industrial (46.6); institutional (44.3); multifamily residential (47.2)

Click on graph for larger image.

This graph shows the Architecture Billings Index since 1996. The index was at 43.3 in September, down from 47.2 in August.  Anything below 50 indicates a decrease in demand for architects' services.

This index has indicated contraction for 34 of the last 36 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 38 consecutive months.  This suggests we will some further weakness in multi-family starts.

by Calculated Risk on 10/22/2025 02:27:00 PM

Today, in the Calculated Risk Real Estate Newsletter: 2nd Look at Local Housing Markets in September

A brief excerpt:

The NAR is scheduled to release September Existing Home sales on Thursday, October 23rd at 10:00 AM. The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR.

Housing economist Tom Lawler expects the NAR to report sales of 4.00 million SAAR for September.

September sales will be mostly for contracts signed in July and August, and mortgage rates averaged 6.72% in July and 6.59% in August (lower than for closed sales in July).

In September, sales in these markets were up 8.2% YoY. Last month, in August, these same markets were down 2.5% year-over-year Not Seasonally Adjusted (NSA).

Important: There were one more working days in September 2025 (21) as in September 2024 (20). So, the year-over-year change in the headline SA data will be lower than the NSA data suggests (there are other seasonal factors).
...
More local markets to come after the NAR release.

There is much more in the article.

by Calculated Risk on 10/22/2025 07:00:00 AM

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 0.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 17, 2025.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 0.2 percent compared with the previous week. The Refinance Index increased 4 percent from the previous week and was 81 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 5 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent compared with the previous week and was 20 percent higher than the same week one year ago.

“The lowest mortgage rates in a month spurred an increase in refinance activity, including another pickup in ARM applications. The 30-year fixed rate decreased to 6.37 percent and all other loan types also decreased,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The refinance index increased 4 percent, driven by a 6 percent increase in conventional refinances and a 12 percent increase in FHA refinance applications, as borrowers remain attentive to these opportunities to lower their monthly mortgage payment. VA refinances bucked the trend and were down 12 percent.”

Added Kan, “ARM applications increased 16 percent over the week, which pushed the ARM share to 11 percent, with the ARM rate more than 80 basis points lower than the 30-year fixed rate. Purchase applications were down over the week but remained 20 percent higher than a year ago.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) decreased to 6.37 percent from 6.42 percent, with points decreasing to 0.59 from 0.61 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.

The first graph shows the MBA mortgage purchase index.

According to the MBA, purchase activity is up 20% year-over-year unadjusted. 

Red is a four-week average (blue is weekly).  

Purchase application activity is still depressed, but above the lows of 2023 and slightly above the lowest levels during the housing bust.  

The second graph shows the refinance index since 1990.

The refinance index has increased from the bottom as mortgage rates declined.

by Calculated Risk on 10/21/2025 07:58:00 PM

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

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

• During the day, The AIA/Deltek's Architecture Billings Index for September (a leading indicator for commercial real estate).

by Calculated Risk on 10/21/2025 03:46:00 PM

Here are a few photos from my trip to Patagonia:

Click on graph for larger image.

The first photo is at Cape Horn with a friend since high school. 

We were lucky to able to go ashore!

The albatross is a memorial to all the sailors that lost their lives sailing around the Cape.

Here is a poem on a plaque near the monument.

"I am the albatross that awaits you at the end of the world.
I am the forgotten souls of dead mariners who crossed Cape Horn from every sea on Earth.
But they did not die in the raging waves; today they fly on my wings toward eternity, in the last crevice of the Antarctic winds."
by Sara Vial

The second photo is at Torres del Paine National Park.

This shows the granite towers and horns.

The "horns" are sedimentary rock (black) on top of granite (gray).

The park is known for ferocious wind gusts - and it did not disappoint!

The third photo is also at Torres del Paine National Park.

This is at Gray Glacier Lake.

This lake is known for the bright blue icebergs - and there was a large one close to shore when we arrived.

"Paine" means blue in the indigenous language, so the park is named after the towers and the amazing blue lakes.

The wind was gusting up to 85 knots when I took this photo. You had to lean into the winds at times.

A great trip!

by Calculated Risk on 10/21/2025 12:19:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Lawler: Early Read on September Existing Home Sales, and Update on MBS Yields and Spreads

A brief excerpt:

From housing economist Tom Lawler:

Early Read on Existing Home Sales in September

Based on publicly-available local realtor/MLS reports released across the country through today, I project that existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 4.00 million in September, unchanged from August’s preliminary pace (which looked too high relative to state and local realtor data) and up 2.6% last September’s seasonally adjusted pace. Unadjusted sales should show a larger YOY % increase, reflecting this September’s higher business day count relative to last September’s.

Local realtor/MLS reports suggest that the median existing single-family home sales price last month was up by about 2.2% from a year earlier.

CR Note: The NAR is scheduled to release September Existing Home sales on Thursday, October 23rd at 10:00 AM. The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR.

There is also an update on MBS Yields and Spreads in the article.

by Calculated Risk on 10/21/2025 11:31:00 AM

Catching up ...

The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 37, up from 32 last month. Any number below 50 indicates that more builders view sales conditions as poor than good.

From the NAHB: Amid Market Challenges, Builder Expectations Rise in October

Even as builders continue to grapple with market and macroeconomic uncertainty, sentiment levels posted a solid gain in October as future sales expectations surpassed the 50-point breakeven mark for the first time since last January.

Builder confidence in the market for newly built single-family homes was 37 in October, up five points from September and the highest reading since April, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today.

“While recent declines for mortgage rates are an encouraging sign for affordability conditions, the market remains challenging,” said NAHB Chairman Buddy Hughes, a home builder and developer from Lexington, N.C. “The housing market has some areas with firm demand, including smaller builders shifting to remodeling and ongoing solid conditions for the luxury market. However, most home buyers are still on the sidelines, waiting for mortgage rates to move lower.”

“The HMI gain in October is a positive signal for 2026 as our forecast is for single-family housing starts to gain ground next year,” said NAHB Chief Economist Robert Dietz. “The 30-year fixed-rate mortgage fell from just above 6.5% at the start of September to 6.3% in early October. Combined with anticipated further easing by the Fed, builders expect a slightly improving sales environment, albeit one in which persistent supply-side cost factors remain a challenge.”

With the government shutdown continuing and an expectation of no Census housing construction data for September being published this week, Dietz noted the following: “Based on modeling of historical data, the October increase for the HMI suggests an approximate 3% increase for the September single-family permit data on a seasonally adjusted annual rate basis. Our model suggests a 2% to 4% range for the increase based on the statistical relationship.”

In a sign of ongoing challenges for the housing market, the latest HMI survey also revealed that 38% of builders reported cutting prices in October. This share has alternated between 37% and 39% since June. Meanwhile, the average price reduction rose to 6% in October after averaging 5% for several months previously. The last time builders reduced prices by 6% was a year ago in October 2024. The use of sales incentives was 65% in October, unchanged from September.
...
All the HMI subindices rose in October. The component measuring current sales conditions increased four points to 38, the index gauging future sales jumped nine points to 54 and the gauge charting traffic of prospective buyers posted a four-point gain to 25.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose two points to 46, the Midwest was unchanged at 42, the South increased two points to 31 and the West gained two points to 28.
emphasis added

Click on graph for larger image.

This graph shows the NAHB index since Jan 1985.

The index has been below 50 for eighteen consecutive months.

by Calculated Risk on 10/21/2025 08:47:00 AM

Container traffic gives us an idea about the volume of goods being exported and imported - and usually some hints about the trade report since LA area ports handle about 40% of the nation's container port traffic.

The following graphs are for inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container).

The first graph is the monthly data (with a strong seasonal pattern for imports).

Click on graph for larger image.

Usually imports peak in the July to October period as retailers import goods for the Christmas holiday and then decline sharply and bottom in the Winter depending on the timing of the Chinese New Year.  

Imports were down 7% YoY in September, and exports were down 2% YoY.    

To remove the strong seasonal component for inbound traffic, the second graph shows the rolling 12-month average.

On a rolling 12-month basis, inbound traffic decreased 0.6% in September compared to the rolling 12 months ending the previous month.   

Outbound traffic decreased 0.1% compared to the rolling 12 months ending the previous month.

This is the 10th consecutive month with exports down YoY.