by Calculated Risk on 7/30/2025 07:00:00 AM

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

Mortgage applications decreased 3.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 25, 2025.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 4 percent compared with the previous week. The Refinance Index decreased 1 percent from the previous week and was 30 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 6 percent from one week earlier. The unadjusted Purchase Index decreased 6 percent compared with the previous week and was 17 percent higher than the same week one year ago.

“Mortgage applications fell to their lowest level since May, with both purchase and refinance activity declining over the week. There is still plenty of uncertainty surrounding the economy and job market, which is weighing on prospective homebuyers’ decisions,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The 30-year fixed rate was little changed at 6.83 percent, but high enough that there was not much interest in refinancing, pushing the refinance index lower for the third straight week. Purchase applications decreased by almost 6 percent, as applications for conventional, FHA, and VA purchase loans fell, despite slowing home-price growth and increasing levels of for-sale inventory in many regions.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) decreased to 6.83 percent from 6.84 percent, with points decreasing to 0.60 from 0.62 (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 17% year-over-year unadjusted. 

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

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

The second graph shows the refinance index since 1990.

The refinance index decreased and remains very low.

by Calculated Risk on 7/29/2025 08:09:00 PM

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

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

• At 8:15 AM, The ADP Employment Report for June. This report is for private payrolls only (no government). The consensus is for 75,000 payroll jobs added in June, up from -33,000 in May.

• At 8:30 AM, Gross Domestic Product, 2nd quarter (advance estimate), and annual update. The consensus is that real GDP increased 2.5% annualized in Q2, up from -0.5% in Q1.

• At 10:00 AM, Pending Home Sales Index for June. The consensus is for a 0.3% increase in the index.

• At 2:00 PM, FOMC Meeting Announcement. No change to the Fed Funds rate is expected.

• At 2:30 PM, Fed Chair Jerome Powell holds a press briefing following the FOMC announcement.

by Calculated Risk on 7/29/2025 01:41:00 PM

Last month, I noted:

State and local government education hiring was reported at 63.5 thousand in June (seasonally adjusted).  On a Not Seasonally Adjusted (NSA) basis, 542.4 thousand education jobs lost.  This happens every June.   However, this year fewer jobs were lost than expected resulting in the large SA gain.  It is possible this is just a timing issue and more than expected educators will be let go in July.

BofA economists noted this morning: July jobs report: beware the unexpected

Government employment (federal, state and local) surged by 73k in June, compared to an average of 13k over the first five months of the year. The spike in June was driven by what appears to be a seasonal distortion in state & local education employment, which should get paid back in July. We assume a 25k decline in total government payrolls with risks to the upside if the payback instead happens when schools reopen.

Looking back at previous years, it is possible we will see a seasonally adjusted decline in state and local education of 50 thousand or more for July (payback for June). This will be something to watch out for!

by Calculated Risk on 7/29/2025 10:00:00 AM

From the BLS: Job Openings and Labor Turnover Summary

The number of job openings was little changed at 7.4 million in June, the U.S. Bureau of Labor Statistics reported today. Over the month, both hires and total separations were little changed at 5.2 million and 5.1 million, respectively. Within separations, quits (3.1 million) were little changed while layoffs and discharges (1.6 million) were unchanged.
emphasis added

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

This series started in December 2000.

Note: The difference between JOLTS hires and separations is similar to the CES (payroll survey) net jobs headline numbers. This report is for June; the employment report this Friday will be for July.

Click on graph for larger image.

Note that hires (dark blue) and total separations (red and light blue columns stacked) are usually pretty close each month. This is a measure of labor market turnover.  When the blue line is above the two stacked columns, the economy is adding net jobs - when it is below the columns, the economy is losing jobs.

The spike in layoffs and discharges in March 2020 is labeled, but off the chart to better show the usual data.

Jobs openings decreased in June to 7.44 million from 7.71 million in May.

The number of job openings (black) were mostly unchanged year-over-year. 

Quits were down 4% year-over-year. These are voluntary separations. (See light blue columns at bottom of graph for trend for "quits").

by Calculated Risk on 7/29/2025 09:46:00 AM

Today, in the Calculated Risk Real Estate Newsletter: Case-Shiller: National House Price Index Up 2.3% year-over-year in May

Excerpt:

S&P/Case-Shiller released the monthly Home Price Indices forMay ("May" is a 3-month average of March, April and May closing prices). March closing prices include some contracts signed in January, so there is a significant lag to this data. Here is a graph of the month-over-month (MoM) change in the Case-Shiller National Index Seasonally Adjusted (SA).

The MoM decrease in the seasonally adjusted (SA) Case-Shiller National Index was at -0.29% (a -3.5% annual rate). This was the third consecutive MoM decrease.

On a seasonally adjusted basis, prices increased month-to-month in just 8 of the 20 Case-Shiller cities. San Francisco has fallen 8.2% from the recent peak, Tampa is down 3.3% from the peak, and Denver down 3.3%.

by Calculated Risk on 7/29/2025 09:00:00 AM

S&P/Case-Shiller released the monthly Home Price Indices for May ("May" is a 3-month average of March, April and May closing prices).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.

From S&P S&P CoreLogic Case-Shiller Index Records 2.3% Annual Gain in May 2025

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 2.3% annual return for May, down from a 2.7% annual gain in the previous month. The 10-City Composite saw an annual increase of 3.4%, down from a 4.1% annual increase in the previous month. The 20-City Composite posted a year-over-year increase of 2.8%, down from a 3.4% increase in the previous month. New York again reported the highest annual gain among the 20 cities with a 7.4% increase in May, followed by Chicago and Detroit with annual increases of 6.1% and 4.9%, respectively. Tampa posted the lowest return, falling 2.4%.
...
The pre-seasonally adjusted U.S. National Index saw slight upward trends in May, posting gains of 0.4%. The 10-City Composite and 20-City Composite Indices both reported gains of 0.4%.

After seasonal adjustment, the U.S. National Index posted a decrease of -0.3%. Both the 10-City Composite and the 20-City Composite Indices saw a -0.3% decrease, as well.

“May’s data continued the year’s slow unwind of price momentum, with annual gains narrowing for a fourth consecutive month,” said Nicholas Godec, CFA, CAIA, CIPM, Head of Fixed Income Tradables & Commodities at S&P Dow Jones Indices. “National home prices were just 2.3% higher than a year ago, the smallest increase since July 2023, and nearly all of that gain occurred in the most recent six months. The spring market lifted prices modestly, but not enough to suggest sustained acceleration."
emphasis added

Click on graph for larger image.

The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).

The Composite 10 index was down 0.3% in May (SA).  The Composite 20 index was down 0.3% (SA) in May.

The National index was down 0.3% (SA) in May.

The second graph shows the year-over-year change in all three indices.

The Composite 10 NSA was up 3.4% year-over-year.  The Composite 20 NSA was up 2.8% year-over-year.

The National index NSA was up 2.3% year-over-year.

Annual price changes were close to expectations.  I'll have more later.

by Calculated Risk on 7/28/2025 09:09:00 PM

From Matthew Graham at Mortgage News Daily: Mortgage Rates Hold Perfectly Flat to Start New Week

If any given week of movement in the mortgage rate world came with disclaimer, this one would be: "Warning. An absence of volatility on Monday has no bearing on odds for volatility in the rest of the week." More simply put, you're essentially guaranteed to see more rate movement over the next 4 days simply because today saw none.

Of all of the days this week, Monday was the best candidate for a ho-hum level of movement because it was the only day without any major economic data on tap. Rates are based on bonds, and econ data is a key source of inspiration for bonds. [30 year fixed 6.81%]
emphasis added

Tuesday:
• At 9:00 AM ET, S&P/Case-Shiller House Price Index for May. The consensus is for a 2.5% year-over-year increase in the Comp 20 index for May.

• At 9:00 AM, FHFA House Price Index for May. This was originally a GSE only repeat sales, however there is also an expanded index.

• At 10:00 AM, Job Openings and Labor Turnover Survey for June from the BLS.

by Calculated Risk on 7/28/2025 05:09:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Fannie and Freddie: Single Family Serious Delinquency Rates Decreased in June

Excerpt:

Freddie Mac reported that the Single-Family serious delinquency rate in June was 0.55%, unchanged from 0.55% May. Freddie's rate is up year-over-year from 0.50% in June 2024, however, this is below the pre-pandemic level of 0.60%.

Freddie's serious delinquency rate peaked in February 2010 at 4.20% following the housing bubble and peaked at 3.17% in August 2020 during the pandemic.

Fannie Mae reported that the Single-Family serious delinquency rate in May was 0.53%, down from 0.55% in April. The serious delinquency rate is up year-over-year from 0.48% in May 2024, however, this is below the pre-pandemic lows of 0.65%.

Fannie Mae reported that the Single-Family serious delinquency rate in June was 0.53%, unchanged from 0.53% in May. The serious delinquency rate is up year-over-year from 0.48% in June 2024, however, this is below the pre-pandemic lows of 0.65%.

There is much more in the article.

by Calculated Risk on 7/28/2025 01:09:00 PM

The Census Bureau released the Residential Vacancies and Homeownership report for Q2 2025 today.

The results of this survey were significantly distorted by the pandemic in 2020.

This report is frequently mentioned by analysts and the media to track household formation, the homeownership rate, and the homeowner and rental vacancy rates.  However, there are serious questions about the accuracy of this survey.

This survey might show the trend, but I wouldn't rely on the absolute numbers. Analysts probably shouldn't use the HVS to estimate the excess vacant supply or household formation, or rely on the homeownership rate, except as a guide to the trend.

National vacancy rates in the second quarter 2025 were 7.0 percent for rental housing and 1.1 percent for homeowner housing. The rental vacancy rate was higher than the rate in the second quarter 2024 (6.6 percent) and not statistically different from the rate in the first quarter 2025 (7.1 percent).

The homeowner vacancy rate of 1.1 percent was higher than the rate in the second quarter 2024 (0.9 percent) and virtually the same as the rate in the first quarter 2025 (1.1 percent).

The homeownership rate of 65.0 percent was not statistically different from the rate in the second quarter 2024 (65.6 percent) and not statistically different than the rate in the first quarter 2025 (65.1 percent).
emphasis added

Click on graph for larger image.

The Red dots are the decennial Census homeownership rates for April 1st, 1990, 2000, 2010, and 2020. 

The HVS homeownership rate was decreased to 65.0% in Q2, from 65.1% in Q1.  

The results in Q2 and Q3 2020 were distorted by the pandemic and should be ignored.

The HVS homeowner vacancy was unchanged at 1.1% in Q2 from 1.1% in Q1.

The homeowner vacancy rate declined sharply during the pandemic and includes homes that are vacant and for sale (so this mirrors the low but increasing levels of existing home inventory).

Once again - this probably shows the general trend, but I wouldn't rely on the absolute numbers.

The rental vacancy rate decreased to 7.0% in Q2 from 7.1% in Q1.  This is up from the low of 5.6% in 2021 and 2022.

The quarterly HVS is the timeliest survey on households, but there are many questions about the accuracy of this survey.

by Calculated Risk on 7/28/2025 11:01:00 AM

Here are the daily travel numbers from the TSA.

This data is as of July 27, 2025.

Click on graph for larger image.

This data shows the 7-day average of daily total traveler throughput from the TSA for the last 6 years.

Air travel is essentially unchanged YoY (7-day average up about 0.5% YoY).

The red line is the seven-day average for 2025.  

2020 (black) was the worst year for air travel due to COVID.  Each year that followed showed a pickup in air travel, with 2023 (yellow) finally reaching 2019 levels (light blue).

There is no growth this year with air travel mostly tracking 2024 levels.