by Calculated Risk on 10/11/2025 08:11:00 AM

NOTE: I'm on vacation returning next week. Government data might be rescheduled due to the government shutdown.

The key economic reports this week are September CPI, Retail Sales and Housing Starts.

For manufacturing, September Industrial Production, and the October New York and Philly Fed surveys will be released this week.

----- Monday, October 13th -----
Columbus Day Holiday: Banks will be closed in observance of Columbus Day. The stock market will be open.

----- Tuesday, October 14th -----
6:00 AM: NFIB Small Business Optimism Index for September.

----- Wednesday, October 15th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

8:30 AM: The Consumer Price Index for September from the BLS. 

8:30 AM ET: The New York Fed Empire State manufacturing survey for October. 

2:00 PM: the Federal Reserve Beige Book, an informal review by the Federal Reserve Banks of current economic conditions in their Districts.

----- Thursday, October 16th -----
8:30 AM: The initial weekly unemployment claims report will be released. 

8:30 AM: The Producer Price Index for September from the BLS. 

8:30 AM ET: The Philly Fed manufacturing survey for October. 

8:30 AM ET: Retail sales for September will be released.  

This graph shows retail sales since 1992. This is monthly retail sales and food service, seasonally adjusted (total and ex-gasoline).

10:00 AM: The October NAHB homebuilder survey. Any number below 50 indicates that more builders view sales conditions as poor than good.

----- Friday, October 17th -----
8:30 AM: Housing Starts for September.

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

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

This graph shows industrial production since 1967.

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

Note: CR is on vacation until Oct 21st.

This interview was in July 2024 and is still holding up!

I'm not sure about "renowned" but this interview hits several of the key points I've been discussing about housing.

From Lance Lambert at ResiClub: Renowned housing analyst who predicted the 2008 home price crash weighs in on the current market Here is the intro:

Years before the housing bubble burst in 2008, housing analyst Bill McBride began chronicling the troubles in the U.S. housing market in his blog Calculated Risk.

Not only did he predict the crash, but he also called the 2012 housing price bottom. Fast-forward to 2024, and this cycle he hasn’t been as concerned as he was in 2007.

McBride has maintained for the past few years that this housing cycle will ultimately resemble something closer to the 1978 to 1982 period—a time of overheated house price growth that saw spiked interest rates, strained affordability, crashed existing home sales volume, and yet no national home price crash—rather than the 2007-2011 national housing price crash years.

To better understand Bill McBride's perspective on the current housing and economic cycle, ResiClub reached out and conducted a Q&A with him.

Enjoy!

by Calculated Risk on 10/09/2025 09:31:00 AM

CR Note: On vacation. I will return on Tuesday, October 21st. (If I don't get lost!)

In December 2006, my friend Doris "Tanta" Dungey started writing for Calculated Risk.

When some people say that here are few women bloggers in finance and economics, I remind them that Tanta was the best of all of us!

From December 2006, until she passed away from ovarian cancer on Nov 30, 2008, Tanta was my co-blogger. Tanta worked as a mortgage banker for 20 years, and we started chatting in early 2005 about the housing bubble and the changes in lending practices. In 2006, Tanta was diagnosed with late stage cancer, and she took an extended medical leave while undergoing treatment. While on medical leave she wrote for this blog, and her writings received widespread attention and acclaim.

Here are excerpts from her first two posts:

From December 2006: Let Slip the Dogs of Hell

I still haven’t gotten over the fact that there’s a “capital management” group out there having named itself “Cerberus”. Those of you who were not asleep in Miss Buttkicker’s Intro to Western Civ will recognize Cerberus; the rest of you may have picked up the mythological fix from its reprise as “Fluffy” in the first Harry Potter novel. Wherever you get your culture, Cerberus is the three-headed dog who guards the gates of Hell. It takes three heads to do that, of course, because it’s never clear, in theology or finance, whether the idea is to keep the righteous from falling into the pit or the demons from escaping out of it (the third head is busy meeting with the regulators). Cerberus is relevant not just because it supplies me with today’s metaphor, but because it was the Biggest Dog of three (including Citigroup and Aozora, a Japanese bank) who in April bought a 51% stake in GMAC’s mega-mortgage operation, GM having, of course, once been renowned as one of the Big Three Automakers until it became one of the Big Three Financing Outfits With A Sideline In Cars. I tried to find a link for you to Aozora Bank’s announcement of the purchase, but the only press release I could find for that day involved the loss of customer data. They must have been so busy letting GMAC into the underworld that the dog head keeping the deposit tickets from getting out got distracted.
...
Now, I’m just a Little Mortgage Weenie, not a Big Finance Dog, but bear with me while I ask some stupid questions. Like: how do the Big Dogs maintain “diverse and flexible production channels” (i.e., little mortgage banker Puppies to sell you correspondent business and little broker Puppies to sell you wholesale business) when “market share currently held by top-tier players” expands to two-thirds (meaning less diverse off-load strategies for the Little Puppies in the “production channels,” putting them at further pipeline/counterparty risk unless they become Bigger Puppies, which makes them competitors instead of “channels,”), while at the same time watching some of the Little Puppies (in whom the Big Dogs have a major equity stake) crawl under the porch to die? I know Citi doesn’t seem to have noticed that the “increased regulatory scrutiny” is not just of “products” but of “wholesale operational/management controls,” but I did.

And from December 2006: On Hybrids, Teasers, and Other Mortgage Guidance Problems

First of all, a “hybrid ARM” is called a “hybrid” because it is, basically, a cross between a fixed rate and adjustable rate mortgage. Before the early 90s, an “ARM” basically meant a one-year ARM. The initial interest rate was set for one year, and the rate adjusted every year. The only real variations on this theme involved shortening the adjustment frequency: you could get an ARM that adjusted every six months instead of one year.

Around the early 90s, the “hybrid ARM” was introduced. It had an initial period in which the rate was “fixed” that didn’t match the subsequent adjustment frequency: this is the classic 3/1, 5/1, 7/1, and even 10/1 ARM. The whole idea of the hybrid ARM was to provide a kind of medium-range risk/reward tradeoff for borrowers and lenders.

CR Note: If you want to understand the mortgage industry, read Tanta's posts (here is The Compleat UberNerd and a Compendium of Tanta's Posts).

Also see In Memoriam: Doris "Tanta" Dungey for photos, links to obituaries in the NY Times, Washington Post and much more.

by Calculated Risk on 10/08/2025 11:08:00 AM

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

Mortgage applications decreased 4.7 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 3, 2025.

The Market Composite Index, a measure of mortgage loan application volume, decreased 4.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5 percent compared with the previous week. The Refinance Index decreased 8 percent from the previous week and was 18 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 14 percent higher than the same week one year ago.

“With mortgage rates on fixed-rate loans little changed last week, refinance application activity generally declined, with the exception of a modest increase for FHA refinance applications,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Refinance volume remains somewhat elevated relative to levels of a month ago. Purchase activity declined by about 1 percent for the week but continues to show moderate growth on an annual basis, and stronger growth for FHA loans, favored by first-time homebuyers.

Added Fratantoni, “The ARM share increased to 9.5 percent last week from 8.4 percent the prior week. Our survey shows 5/1 ARM rates are averaging almost a percentage point below 30-year fixed rates, and this differential is leading more purchase and refinance applicants to consider ARMs."

on the road, no graphs this week!

by Calculated Risk on 10/08/2025 08:11:00 AM

Note: CR is on vacation until Oct 21st.

This is the 21st year I've been writing this blog!

Starting in January 2005, I was very bearish on housing - and in early 2007, I predicted a recession.

However in 2009 I became more optimistic. For example, in February 2009, I wrote: Looking for the Sun (Note: that post shocked many readers since I had been very bearish).

A few years later, in early 2012, when many people were still bearish on housing, I called the bottom for housing: The Housing Bottom is Here

Then I spent a number of years arguing against the recession callers, and the new housing bubble calls. A few examples:

In 2015, I wrote The Endless Parade of Recession Calls

For the last 6+ years, there have been an endless parade of incorrect recession calls. The most reported was probably the multiple recession calls from ECRI in 2011 and 2012.
...
I disagreed with that call in 2011; I wasn't even on recession watch!

And I updated that post several times.

And on housing, over seven years ago, in January 2018, I was quoted in a Bloomberg article:

Bill McBride, who runs the Calculated Risk blog and also called the crash, doesn’t think home prices are inflated this time around. Unlike in 2005, lenders are acting responsibly and the Wild West of real estate speculation hasn’t returned, he said. There is less to speculate on, too. Compared with the overbuilding that preceded the bust, today’s pace of construction isn’t fast enough, he said.

“Lending standards are still pretty good,” McBride said, and he doesn’t expect mortgage rates to “take off” in the short term.

And in December 2018, I disagreed with Professor Shiller A comment on Professor Shiller's "The Housing Boom Is Already Gigantic. How Long Can It Last?". My conclusion:

No big deal, and definitely not a "gigantic" boom in house prices.

In 2021, I wrote: Is there a New Housing Bubble?

The lack of wild speculation doesn't mean house prices can't decline, but it means that we won't see cascading declines in prices like what happened when the housing bubble burst.
...
From a historical perspective, house prices are high. But lending standards have been solid, and we haven't seen significant speculation - so I wouldn't call this a bubble.

Also in 2021, I started my real estate newsletter.  

Note: for $25 you can read the entire archive and one month of daily posts - but make sure you cancel or substack will bill you every month! For $100, you will usually receive 4 to 6 articles per week for a year, you can read the archive and comment on all the posts.

A few key articles:

Housing and Demographics: The Next Big Shift

Housing: Don't Compare the Current Housing Boom to the Bubble and Bust

Household Formation Drives Housing Demand

The Long-Term Housing and Population Shift

Stay tuned!

by Calculated Risk on 10/07/2025 08:00:00 PM

I'll be lost in the wilderness - with little wifi - until probably October 21st.

Best to all!

by Calculated Risk on 10/07/2025 02:11:00 PM

From Manheim Consulting today: Wholesale Used-Vehicle Prices Decline Slightly in September

Wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) were down slightly in September compared to August. The Manheim Used Vehicle Value Index (MUVVI) declined to 207.0, lower by 0.2% versus August levels but showing an increase of 2% from a year ago. The seasonal adjustment caused the index to decrease for the month, as non-seasonally adjusted values moved slightly higher in September. The non-adjusted price in September increased just 0.1% compared to August, moving the unadjusted average price higher by 2.1% year over year. The long-term move on average for non-seasonally adjusted values is a decline of 0.3% in the month, demonstrating that the unadjusted depreciation trends in September were less than normally seen.
emphasis added

Click on graph for larger image.

This index from Manheim Consulting is based on all completed sales transactions at Manheim’s U.S. auctions.

The Manheim index suggests used car prices were declined slightly in September (seasonally adjusted) and were up 2% YoY.

by Calculated Risk on 10/07/2025 08:18:00 AM

Today, in the Calculated Risk Real Estate Newsletter: 1st Look at Local Housing Markets in September

A brief excerpt:

Tracking local data gives an early look at what happened the previous month and also reveals regional differences in both sales and inventory.

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 early reporting markets were up 7.0% YoY. Last month, in August, these same markets were down 1.8% 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).
...
This was just several early reporting markets. Many more local markets to come!

There is much more in the article.

by Calculated Risk on 10/06/2025 07:54:00 PM

From Matthew Graham at Mortgage News Daily: MMortgage Rates Start The Week Near Recent Highs

Mortgage rates began the week right in line with their highest levels of the past 30 days. This sounds a bit more dramatic than it is because the past 2.5 weeks have been very narrow and today's rates are merely at the upper edge of that range (i.e. not much different than the recent lows).
...
More extreme rate movement remains on hold until the government shutdown ends, thus allowing the publication of the big-ticket economic reports that have the biggest impacts on rates. [30 year fixed 6.38%]
emphasis added

Tuesday:
• At 8:30 AM ET, Trade Balance report for August from the Census Bureau.  The consensus is for the deficit to be $61.4 billion in August, from $78.3 billion in July.

• At 2:00 PM, FOMC Minutes, Minutes Meeting of September 16-17, 2025

by Calculated Risk on 10/06/2025 01:22:00 PM

Today, in the Real Estate Newsletter: Asking Rents Mostly Unchanged Year-over-year

Brief excerpt:

Another monthly update on rents.

Tracking rents is important for understanding the dynamics of the housing market. Slower household formation and increased supply (more multi-family completions) has kept asking rents under pressure.

More recently, immigration policy has become a negative for rentals.

Apartment List: Asking Rent Growth -0.8% Year-over-year ...

The national median rent dipped by 0.4% in September, and now stands at $1,394. This was the second consecutive month-over-month decline, as we’ve now entered the rental market’s off-season. It’s likely that we’ll continue to see further modest rent declines through the remainder of the year.

Realtor.com: 25th Consecutive Month with Year-over-year Decline in Rents

In August 2025, the U.S. median rent recorded its 25th consecutive year-over-year decline. Rent for 0–2 bedroom properties across the 50 largest metropolitan areas dropped by 2.2% compared to the previous year, with the median asking rent at $1,713—just $5 lower than the prior month.

There is much more in the article.

by Calculated Risk on 10/06/2025 09:52:00 AM

Today, in the Real Estate Newsletter: October ICE Mortgage Monitor: "Home Prices Firm" in September, Up 1.2% Year-over-year

Brief excerpt:

House Prices Up 1.2% Year-over-year

Here is the year-over-year in house prices according to the ICE Home Price Index (HPI). The ICE HPI is a repeat sales index. ICE reports the median price change of the repeat sales. The index was up 1.2% year-over-year in September, up from 1.0% YoY in August.

• Annual home price growth re-accelerated in early September following eight consecutive months of slowing ‒ rising to +1.2% from a revised +1.0% in August – as falling inventory met improved affordability from easing mortgage rates

• On a seasonally adjusted basis, prices rose by +0.17% in the month, equivalent to a seasonally adjusted annualized rate (SAAR) of +2.1%, suggesting the annual home price growth rate may tick modestly higher in coming months

• The bulk of the firming occurred among single family residences, which are up +1.5% from the same time last year, an increase from +1.3% in August

• The condo market remains soft, with prices down -1.8% from the same time last year, a modest improvement from -1.9% in August

• Only 20% of markets saw prices fall on a seasonally adjusted basis in September, the fewest in nine months and down from 55% just two months prior

There is much more in the article.

by Calculated Risk on 10/06/2025 08:11:00 AM

Altos reports that active single-family inventory increased 0.2% week-over-week.  Inventory usually starts to decline in the fall and then declines sharply during the holiday season.

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 17.7% compared to the same week in 2024 (last week it was up 18.0%), and down 9.5% compared to the same week in 2019 (last week it was down 9.6%). 

Inventory started 2025 down 22% compared to 2019.  Inventory has closed more than half of that gap, but it appears inventory will still be below 2019 levels at the end of 2025.

This second inventory graph is courtesy of Altos Research.

As of October 3rd, inventory was at 864 thousand (7-day average), compared to 863 thousand the prior week. 

Mike Simonsen discusses this data and much more regularly on YouTube

by Calculated Risk on 10/05/2025 06:20:00 PM

Weekend:
• Schedule for Week of October 5, 2025

Monday:
• No major economic releases scheduled.

From CNBC: Pre-Market Data and Bloomberg futures S&P 500 are up 6 and DOW futures are up 46 (fair value).

Oil prices were down over the last week with WTI futures at $61.73 per barrel and Brent at $65.47 per barrel. A year ago, WTI was at $75, and Brent was at $79 - so WTI oil prices are down about 17% year-over-year.

Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $3.09 per gallon. A year ago, prices were at $3.14 per gallon, so gasoline prices are down $0.05 year-over-year.

by Calculated Risk on 10/05/2025 08:21:00 AM

From the Association of American Railroads (AAR) AAR Data Center. Graph and excerpts reprinted with permission.

The AAR Freight Rail Index (FRI), combines seasonally adjusted rail intermodal shipments plus carloads excluding coal and grain. The index fell 0.8% in September 2025 from August 2025, its fifth decline in the past six months. Still, the index is only 1.0% below its level from a year earlier, indicating that recent weakness reflects a gradual adjustment rather than a sharp downturn.
emphasis added

Rail traffic volumes continue to adjust to evolving market conditions. In September 2025, total U.S. rail carloads fell 1.2% year-over-year, with 12 of the 20 major carload categories tracked by the AAR posting declines.
...
U.S. intermodal rail shipments, which are closely tied to consumer demand and international trade, fell 1.3% in September 2025 from September 2024.

by Calculated Risk on 10/04/2025 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 1.7% year-over-year in July

• Inflation Adjusted House Prices 2.7% Below 2022 Peak

• Freddie Mac House Price Index Up 1.6% Year-over-Year

• Fannie and Freddie: Multi-Family Delinquency Rate Highest Since Housing Bust (ex-pandemic)

• Final Look at Housing Markets in August and a Look Ahead to September Sales

• Lawler: NAR “Fixes” Median Sales Price for July

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

by Calculated Risk on 10/04/2025 08:11:00 AM

The key report scheduled for this week is the August Trade Deficit (Will not be released if government shutdown).

----- Monday, October 6th -----
No major economic releases scheduled.

----- Tuesday, October 7th -----
8:30 AM: Trade Balance report for August from the Census Bureau.  The consensus is for the deficit to be $61.4 billion in August, from $78.3 billion in July.

This graph shows the U.S. trade deficit, with and without petroleum, through the most recent report. The blue line is the total deficit, and the black line is the petroleum deficit, and the red line is the trade deficit ex-petroleum products.

2:00 PM: FOMC Minutes, Minutes Meeting of September 16-17, 2025

----- Wednesday, October 8th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

----- Thursday, October 9th -----
8:30 AM: The initial weekly unemployment claims report will be released. 

----- Friday, October 10th -----
10:00 AM: University of Michigan's Consumer sentiment index (Preliminary for October).

by Calculated Risk on 10/03/2025 01:15:00 PM

From BofA:

Since our last weekly publication, 3Q GDP tracking increased to 2.8% q/q saar from 2.6% after 2Q GDP came in at 3.8% in the third estimate. [October 3rd estimate]
emphasis added

From Goldman:

We boosted our Q3 GDP tracking estimate by 0.2pp to +2.8% (quarter-over-quarter annualized), reflecting stronger consumer spending in August and a more favorable monthly path between Q2 and Q3 than we had previously assumed. Our Q3 domestic final sales estimate now stands at +1.9%. [September 26th estimate]

And from the Atlanta Fed: GDPNow

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2025 is 3.8 percent on October 1, down from 3.9 percent on September 26. After this morning’s release from the Institute for Supply Management, a decrease in the nowcast of third-quarter real personal consumption expenditures growth from 3.4 percent to 3.2 percent was partially offset by an increase in the nowcast of real gross private domestic investment growth from 4.1 percent to 4.2 percent. The US Census Bureau construction spending report was not released this morning because of the government shutdown. We plan on maintaining the release schedule throughout the shutdown but will skip updates if there are no monthly data releases since the last GDPNow update. [October 1st estimate]

by Calculated Risk on 10/03/2025 10:00:00 AM

(Posted with permission). The ISM® Services index was at 50.0%, down from 52.0% last month. The employment index increased to 47.2%, up from 46.5%. Note: Above 50 indicates expansion, below 50 in contraction.

From the Institute for Supply Management: Services PMI® at 50% September 2025 ISM® Services PMI® Report

Economic activity in the services sector was unchanged in September, say the nation's purchasing and supply executives in the latest ISM® Services PMI® Report. The Services PMI® reading of 50 percent was at the breakeven point between expansion and contraction for the first time since January 2010.

The report was issued today by Steve Miller, CPSM, CSCP, Chair of the Institute for Supply Management® (ISM®) Services Business Survey Committee: “In September, the Services PMI® registered an unchanged reading of 50 percent, 2 percentage points lower than the August figure of 52 percent. The Business Activity Index moved into contraction territory in September, registering 49.9 percent, 5.1 percentage points lower than the reading of 55 percent recorded in August. This is the first time the index has entered contraction territory since May 2020. The New Orders Index remained in expansion in September, with a reading of 50.4 percent, down 5.6 percent from August’s figure of 56 percent. The Employment Index remained in contraction territory for the fourth month in a row and the fifth time in the last six months; the reading of 47.2 percent is 0.7 percentage point higher than the 46.5 percent recorded in August.

“The Supplier Deliveries Index registered 52.6 percent, 2.3 percentage points higher than the 50.3 percent recorded in August and its highest reading since February (53.4 percent). This is the 10th consecutive month that the index has been in expansion territory, indicating slower supplier delivery performance. (Supplier Deliveries is the only ISM® PMI® Reports index that is inversed; a reading of above 50 percent indicates slower deliveries, which is typical as the economy improves and customer demand increases.)

“The Prices Index registered 69.4 percent in September, a 0.2-percentage point increase from August’s reading of 69.2 percent. The index has exceeded 60 percent for 10 straight months, its longest such streak since 30 consecutive readings above 60 percent from October 2020 to March 2023.
emphasis added

Employment was in contraction for the 4th consecutive month, and prices paid was high.

by Calculated Risk on 10/03/2025 08:01:00 AM

What this means: On a weekly basis, Realtor.com reports the year-over-year change in active inventory, new listings and median prices. On a monthly basis, they report total inventory. For September, Realtor.com reported active inventory was up 17.0% YoY, but still down 13.9% compared to the 2017 to 2019 same month levels. 

Here is their weekly report: Weekly Housing Trends: Latest Data as of Sept. 27

• Active inventory climbed 16.2% year over year

The number of homes active on the market climbed 16.2% year over year, the easing compared to last week for the 15th straight time. Nevertheless, last week was the 99th consecutive week of annual gains in inventory. There were 1.1 million homes for sale last week, marking the 22nd week in a row over the million-listing threshold. Active inventory is growing significantly faster than new listings, an indication that more homes are sitting on the market for longer

• New listings—a measure of sellers putting homes up for sale—down 0.5% year over year

New listings fell 0.5% last week compared with the same period last year, marking just the third weekly decline since April. This softening is reflected in the September Monthly Housing Report data, where newly listed homes fell 1.2% year over year. The decline in new listings is in part behind the slowdown in national inventory gains over the past few months, as sellers retreat from the market.

• The median listing price was flat year over year

The median list price was flat compared to the same week one year ago. Adjusting for home size, we saw the price per square foot fell 0.5% year over year for the fourth consecutive week. The price per square foot had been growing steadily for almost two years, but the weak sales activity has finally caught up and stalled out this metric, suggesting underlying home values are starting to soften—at least in national aggregates.

by Calculated Risk on 10/02/2025 08:13:00 PM

NOTE: The employment report will not be released due to the government shutdown.

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

Friday:
• At 8:30 AM ET, Employment Report for September.   The consensus is for 43,000 jobs added, and for the unemployment rate to be unchanged at 4.3%.

• At 10:00 AM,: the ISM Services Index for September.