by Calculated Risk on 2/10/2025 12:19:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Part 1: Current State of the Housing Market; Overview for mid-February 2025

A brief excerpt:

This 2-part overview for mid-February provides a snapshot of the current housing market.

I always focus first on inventory, since inventory usually tells the tale! I’m watching months-of-supply closely.
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New home inventory, as a percentage of total inventory, is still very high. The following graph uses Not Seasonally Adjusted (NSA) existing home inventory from the National Association of Realtors® (NAR) and new home inventory from the Census Bureau (only completed and under construction inventory).

It took a number of years following the housing bust for new home inventory to return to the pre-bubble percent of total inventory. Then, with the pandemic, existing home inventory collapsed and now the percent of new homes is 25.1% of the total for sale inventory, down from a peak of 27.2% in December 2022.

The percent of new homes of total inventory should continue to decline as existing home inventory increases. However, the percent of new home inventory has increased seasonally over the Winter as existing homes are withdrawn from the market.

There is much more in the article.

Weekly Schedule

by Calculated Risk on 2/10/2025 08:11:00 AM

Altos reports that active single-family inventory was down 0.4% week-over-week.

Inventory always declines seasonally in the Winter and usually bottoms in late January or February. Inventory is now up 1.3% from the bottom four weeks ago. Inventory has been little changed over the last 4 weeks.

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 2024.  The black line is for 2019.  

Inventory was up 27.8% compared to the same week in 2024 (last week it was up 277%), and down 22.1% compared to the same week in 2019 (last week it was down 22.2%). 

Back in June 2023, inventory was down almost 54% compared to 2019, so the gap to more normal inventory levels has closed significantly!

This second inventory graph is courtesy of Altos Research.

As of Feb 7th, inventory was at 632 thousand (7-day average), compared to 635 thousand the prior week. 

Mike Simonsen discusses this data regularly on Youtube

by Calculated Risk on 2/10/2025 12:01:00 AM

Weekend:
• Schedule for Week of February 9, 2025

Monday:
• No major economic releases scheduled.

From CNBC: Pre-Market Data and Bloomberg futures S&P 500 are up 18 and DOW futures are up 88 (fair value).

Oil prices were down over the last week with WTI futures at $71.00 per barrel and Brent at $74.66 per barrel. A year ago, WTI was at $77, and Brent was at $83 - so WTI oil prices are down about 8% year-over-year.

Here is a graph from Gasbuddy.com for nationwide gasoline prices. Nationally prices are at $3.13 per gallon. A year ago, prices were at $3.18 per gallon, so gasoline prices are down $0.05 year-over-year.

by Calculated Risk on 2/09/2025 08:19:00 AM

From Dodge Data Analytics: Dodge Momentum Index Grows 6% in January

The Dodge Momentum Index (DMI), issued by Dodge Construction Network, grew 5.6% in January to 225.7 (2000=100) from the revised December reading of 213.6. Over the month, commercial planning increased 4.2% while institutional planning improved 8.7%.

“Nonresidential planning activity saw diversified growth in January, with every vertical experiencing positive momentum,” stated Sarah Martin, associate director of forecasting at Dodge Construction Network. “Uncertainty over fiscal policies, ongoing labor shortages and elevated construction costs will continue to be headwinds to the construction sector. However, further monetary easing and the sizable number of projects in planning should support construction spending in the back half of the year.”

On the commercial side, data center, traditional office building, and warehouse planning led this month’s gains. Education and healthcare planning, especially on the hospital side, supported the institutional portion. In January, the DMI was up 26% when compared to year-ago levels. The commercial segment was up 37% from January 2024, while the institutional segment was up 9% over the same period. The influence of data centers on the DMI this year remains substantial. If we remove all data center projects between 2023 and 2025, commercial planning would be up 13% from year-ago levels, and the entire DMI would be up 11%.
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The DMI is a monthly measure of the value of nonresidential building projects going into planning, shown to lead construction spending for nonresidential buildings by a full year.
emphasis added

Click on graph for larger image.

This graph shows the Dodge Momentum Index since 2002. The index was at 225.7 in January, up from 213.6 the previous month.

According to Dodge, this index leads "construction spending for nonresidential buildings by a full year".  This index suggests a slowdown in early 2025, but a pickup in mid-2025.  

Commercial construction is typically a lagging economic indicator.

by Calculated Risk on 2/08/2025 02:11:00 PM

At the Calculated Risk Real Estate Newsletter this week:

Click on graph for larger image.

• MBA: Mortgage Delinquencies Increased Slightly in Q4 2024

• Fannie and Freddie: Single Family Serious Delinquency Rates Increased in December

• Lawler: Revisions Almost Eliminate Household/Establishment Survey Employment Growth Gap

• 1st Look at Local Housing Markets in January

• Asking Rents Mostly Unchanged Year-over-year

• ICE Mortgage Monitor: “Lowest calendar year home price growth of any year since 2011”

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

by Calculated Risk on 2/08/2025 08:11:00 AM

The key reports this week are January CPI and Retail sales.

For manufacturing, the January Industrial Production report will be released this week.

Fed Chair Powell presents the Semiannual Monetary Policy Report to the Congress on Tuesday and Wednesday.

----- Monday, February 10th -----
No major economic releases scheduled.

----- Tuesday, February 11th -----
6:00 AM: NFIB Small Business Optimism Index for January.

10:00 AM: Testimony, Fed Chair Jerome Powell, Semiannual Monetary Policy Report to Congress, Before the U.S. Senate Committee on Banking, Housing, and Urban Affairs

----- Wednesday, February 12th -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the mortgage purchase applications index.

8:30 AM: The Consumer Price Index for January from the BLS. The consensus is for 0.3% increase in CPI, and a 0.3% increase in core CPI.  The consensus is for CPI to be up 2.9% year-over-year and core CPI to be up 3.2% YoY.

10:00 AM: Testimony, Fed Chair Jerome Powell, Semiannual Monetary Policy Report to Congress, Before the U.S. House Financial Services Committee

----- Thursday, February 13th -----
8:30 AM: The initial weekly unemployment claims report will be released. The consensus is for an increase to 224 thousand from 219 thousand last week.

8:30 AM ET: The Producer Price Index for January from the BLS. The consensus is for a 0.2% increase in PPI, and a 0.3% increase in core PPI.

11:00 AM: NY Fed: Q4 Quarterly Report on Household Debt and Credit

----- Friday, February 14th -----
8:30 AM: Retail sales for January is scheduled to be released.  The consensus is for a no change in retail sales.

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

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

This graph shows industrial production since 1967.

The consensus is for a 0.3% increase in Industrial Production, and for Capacity Utilization to increase to 77.7%.

by Calculated Risk on 2/07/2025 07:20:00 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🚩	940	819	≤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 2023.

Although weekly deaths met the original goal to stop posting, I'm continuing to post now that deaths are above the goal again - and at a minimum, I'll continue to post through the Winter.  

Weekly deaths have been increasing, and weekly deaths are triple the low of 313 in early June 2024.

And here is a graph I'm following concerning COVID in wastewater as of February 6th:

This appears to be a leading indicator for COVID hospitalizations and deaths.

Nationally COVID in wastewater is "High" according to the CDC.   

by Calculated Risk on 2/07/2025 04:15:00 PM

From Manheim Consulting today: Wholesale Used-Vehicle Prices Increased in January

Wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) moved 0.4% higher in January compared to December, causing the Manheim Used Vehicle Value Index (MUVVI) to increase to 205.6, a gain of 0.8% from a year ago. The seasonal adjustment to the index muted the movement for the month, as non-seasonally adjusted values rose faster than seasonally adjusted values. The non-adjusted price in January increased by 0.6% compared to December, moving the unadjusted average price up 1.1% year over year.
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 increased in January (seasonally adjusted) and were up 0.8% YoY.

by Calculated Risk on 2/07/2025 01:17:00 PM

Today, in the Calculated Risk Real Estate Newsletter: Lawler: Revisions Almost Eliminate Household/Establishment Survey Employment Growth Gap

A brief excerpt:

From housing economist Tom Lawler: Revisions Almost Eliminate Household/Establishment Survey Employment Growth Gap

Over the last few years there has been a sizable gap between trend growth in the Household Survey estimate of employment and the Establishment Survey estimate of employment, with the Household Survey showing significantly slower growth than the Establishment Survey. I and others noted that much of this “gap” reflected the fact that previous estimates from the Household Survey were “benchmarked” to population estimates that for the last few years were way to low because of an underestimate of net international migration, and that updated population estimates (Vintage 2024) that massively revised up NIM over the last few years would result in a huge upward revision in the household estimate of employment in the January Employment Report.

In today’s employment report the BLS said updated population controls resulted in an huge increase in the Household Survey estimate of employment for December 2024 of 2 million (1.2%).

At the same time, the BLS reported that its annual benchmarking of the Establishment Survey resulted in a decline in the seasonally-adjusted estimate of nonfarm payroll employment for March 2024 of 598,000 (-0.4%).

As a result of these two revisions, the “gap” between the Household Survey of employment and the Establishment Survey estimate of employment – after adjusting for definitional differences – has narrowed substantially.

There is much more in the article.

by Calculated Risk on 2/07/2025 10:53:00 AM

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

A brief excerpt:

NOTE: The tables for active listings, new listings and closed sales all include a comparison to January 2019 for each local market (some 2019 data is not available).

This is the first look at several early reporting local markets in January. I’m tracking over 40 local housing markets in the US. Some of the 40 markets are states, and some are metropolitan areas. I’ll update these tables throughout the month as additional data is released.

Closed sales in January were mostly for contracts signed in November and December when 30-year mortgage rates averaged 6.81% and 6.72%, respectively (Freddie Mac PMMS). This was an increase from the average rate for homes that closed in November, but down from the average rate of 7.1% in November and December 2023.
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In January, sales in these markets were up 6.4% YoY. Last month, in December, these same markets were up 17.1% year-over-year Not Seasonally Adjusted (NSA).

Note that most of these early reporting markets have shown stronger year-over-year sales than most other markets for the last several months.

Important: There were the same number of working days in January 2025 (21) as compared to January 2024 (21). So, the year-over-year change in the headline SA data will be similar to the NSA data (there are other seasonal factors).
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This was just several early reporting markets. Many more local markets to come!

There is much more in the article.