CalculatedRisk Newsletter

The CalculatedRisk Newsletter focuses on in-depth analysis and updates on the real estate market, including housing sales, mortgage rates, housing inventory, credit scores, market dynamics, policy proposals, and economic implications of events like the pandemic on housing. It combines data-driven insights with forecasts and trends.

Real Estate Market Analysis Housing Sales and Inventory Mortgage Rates and Debt Economic Trends Affecting Real Estate Policy and Regulatory Changes Market Forecasts and Predictions

The hottest Substack posts of CalculatedRisk Newsletter

And their main takeaways

Freddie Reports Surge in Multifamily Serious Delinquencies

71 implied HN points • 28 Feb 24
💰 Finance Economics Real Estate
  1. Freddie Mac reported a significant increase in multifamily serious delinquencies in January 2024, marking a shift in the rental market dynamics.
  2. The rise in delinquency rates is attributed to slowed rent growth, increased vacancies, and higher borrowing rates in the multifamily housing sector.
  3. The trend of increasing delinquencies is expected to continue as more apartments become available in 2024, highlighting potential challenges in the real estate market.

1st Look at Local Housing Markets in January

76 implied HN points • 07 Feb 24
  1. Early reports suggest a slight increase in housing sales year-over-year in January.
  2. Inventory in early reporting markets is down compared to 2019, with a key focus on how inventory levels change in the coming months.
  3. New listings in January were up year-over-year, but still remain historically low.
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Case-Shiller: National House Price Index Up 5.5% year-over-year in December

66 implied HN points • 27 Feb 24
💰 Finance Real Estate
  1. The Case-Shiller National House Price Index increased by 5.5% year-over-year in December, showing a trend of rising prices. This was the smallest increase since prices declined in January 2023, hinting at some market fluctuations.
  2. The FHFA House Price Index indicated a 6.5% rise in prices over the last year, with a 0.1% increase in December, pointing towards a steady rise in housing prices despite signs of softening in the market.
  3. The S&P CoreLogic Case-Shiller Index reported a 5.5% annual gain in December, with regions like San Diego, Los Angeles, and Detroit showing significant increases. The Composite 10, Composite 20, and National indices all reached new all-time highs.

Housing Inventory and Demographics: The Next Big Shift

157 implied HN points • 03 Jul 23
💼 Business Housing Demographics Inventory
  1. Existing home inventory trends are not following predictions based on baby boomers downsizing.
  2. Some experts predicted a surge in housing inventory from 2015 to 2025 due to baby boomers downsizing, but that did not happen.
  3. It's important to stay informed about trends in housing inventory and demographics to understand the market shifts.

Lawler: Update on “Is the “Natural” Rate of Interest Back to Pre-Financial Crisis Levels”

62 implied HN points • 16 Feb 24
💰 Finance Economics Real Estate
  1. Existing home sales in January were at a seasonally adjusted annual rate of 4.02 million, showing a 6.3% increase from December and 0.5% from last January.
  2. The estimated 'natural' real rate of interest has shown varying trends, with one measure rising to slightly above 2% for two quarters while another started to move back down.
  3. Economists have noted potential biases in the estimates of the impact of 'other factors' on the 'natural' rate of interest, and some have suggested using TIPS rates as an indicator of market views.

Inflation Adjusted House Prices 3.0% Below Peak

86 implied HN points • 01 Dec 23
  1. Inflation adjusted house prices are 3.0% below the recent peak.
  2. Price-to-rent ratio is 6.9% below the recent peak.
  3. Nominal house prices are at all-time highs in September.

Q3 Update: Delinquencies, Foreclosures and REO

81 implied HN points • 08 Dec 23
  1. Even with some increase in REOs, the housing market is not expected to face a significant impact as most homeowners have substantial equity in their homes.
  2. Homeowner equity has been on the rise, with a 6.8% year-over-year increase and a total gain of $1.1 trillion.
  3. Low mortgage rates and high equity levels mean that few homeowners are likely to experience financial challenges.

Early Read on Existing Home Sales in November

76 implied HN points • 18 Dec 23
  1. Existing home sales in November were estimated to be at a rate of around 3.87 million, showing a slight increase from October.
  2. The National Association of Realtors is projected to report a 2.1% rise in existing home sales compared to the previous month.
  3. However, there was a 6.1% decline in existing home sales when compared to the same period last year.

Single Family Starts Up 22% Year-over-year in January; Multi-Family Starts Down Sharply

57 implied HN points • 16 Feb 24
💰 Finance Housing Market Economic Indicators
  1. Single-family housing starts were up 22% year-over-year in January, while multi-family starts experienced a significant decrease.
  2. There was an overall decrease in total housing starts in January, although November and December numbers were revised up.
  3. Permits held up better than starts in January, with likely impacts from severe weather last month.

Will house prices decline further later this year?

124 implied HN points • 17 Jul 23
💰 Finance Real Estate Market Analysis
  1. The low inventory in the housing market has led to a decline in real house prices, but little decline in nominal prices.
  2. There was a surge in inventory in 2022 due to an increase in mortgage rates, but this surge was short-lived.
  3. House prices have seen recent increases despite challenges with inventory and affordability.

Lawler: Single-Family Rent Results

86 implied HN points • 03 Nov 23
  1. The post discusses the year-over-year changes in rent indexes for different types of rental properties.
  2. The author highlights indexes like the Apartment List Rent Index (ALRI) and the Zillow Observed Rent Index (ZORI).
  3. The table shown in the post includes data from the CoreLogic Single-Family Rent Index (CLSF) as well.

Lawler: Update on Mortgage Rates and Spreads

57 implied HN points • 05 Feb 24
  1. 2023 saw high volatility in US fixed-income and mortgage markets, but rates ended close to the beginning.
  2. Mortgage rates and MBS yields had more volatility than Treasury rates in 2023.
  3. Various factors impact the spreads between mortgage rates and 10-year Treasury rates.

Final Look at Local Housing Markets in September

86 implied HN points • 23 Oct 23
  1. The post discusses a final look at local housing markets in September.
  2. The author tracks closed sales, new listings, and active inventory in over 40 US cities monthly.
  3. Readers can subscribe to the CalculatedRisk Newsletter for further insights on the housing market.

2nd Look at Local Housing Markets in February

47 implied HN points • 12 Mar 24
💼 Business Real Estate Market Analysis
  1. Closed sales in February were influenced by past mortgage rates, showing a decrease from rates in the previous months.
  2. Active inventory in early reporting housing markets increased significantly in February, raising concerns about potential peaks.
  3. New listings in February were up year-over-year, but still at low levels compared to historical data.

Forecast: Multifamily Starts will Decline Sharply

105 implied HN points • 25 Aug 23
💰 Finance Real Estate Economics Housing
  1. Due to household formation slowing down, multifamily starts are expected to decrease significantly.
  2. Freddie Mac reports that multifamily delinquencies have tripled year-over-year, indicating a potential decline in multifamily construction.
  3. Data points show that factors like softening asking rents, increased vacancy rates, tighter lending, and higher interest rates are contributing to the decline in multifamily starts.

4th Look at Local Housing Markets in October

76 implied HN points • 20 Nov 23
  1. The National Association of Realtors is set to release October existing home sales data.
  2. Expectations are for sales of 3.93 million SAAR, with a forecast of 3.94 million SAAR by housing economist Tom Lawler.
  3. The projected sales would be a new cycle low, below 4.00 million SAAR in January 2023.

3rd Look at Local Housing Markets in October

76 implied HN points • 15 Nov 23
  1. Markets report around 4 million SAAR in October
  2. Data includes states and metropolitan areas
  3. Starting next month, there will be comparisons to 2019 data

"The Lock-In Effect of Rising Mortgage Rates"

43 implied HN points • 19 Mar 24
💰 Finance Mortgage Rates Real Estate Market Dynamics Homeownership Financial impact
  1. Homeowners with low interest rates might be hesitant to sell due to higher mortgage rates, impacting the overall housing market.
  2. Rising mortgage rates create a 'lock-in effect,' reducing the probability of home sales and affecting affordability.
  3. The lock-in effect contributes to limited housing supply, increases home prices, and restricts mobility, but is expected to fade over time.

Part 2: Current State of the Housing Market; Overview for mid-December

66 implied HN points • 13 Dec 23
  1. The Case-Shiller National Index showed a 3.9% year-over-year increase in September.
  2. House prices are expected to show a more positive year-over-year change in October.
  3. The post offers an overview of the current state of the housing market in mid-December.

Part 2: Current State of the Housing Market; Overview for mid-March 2024

43 implied HN points • 14 Mar 24
💰 Finance Real Estate Mortgage Rates
  1. The Case-Shiller National Index reported a 5.5% year-over-year increase in house prices in December, with expectations for a slightly more positive change in January.
  2. Monthly, the seasonally adjusted Case-Shiller National Index experienced an 0.19% increase, marking the eleventh consecutive month of increase, yet the smallest growth since January 2023.
  3. The post discusses the outlook for house prices in 2024 and invites readers to subscribe for more detailed information.