Weekly housing inventory data
For the third week in a row, we haven’t quite hit my weekly inventory growth goal yet 11,000 and 17,000 home.However, we are close to our target and the inventory has grown 9,726 There’s a silver lining: Mortgage rates have fallen recently. Another positive is that we have surpassed last year’s total inventory levels, which indicates a gradual increase in inventory on the market.
- Weekly inventory changes (May 10 to May 17): Inventories rose from 568,471 arrive 578,016
- Same week last year (May 12-May 19): Inventory rises 421,101 arrive 424,907
- Historical inventory bottom occurs in 2022 240,194
- This week is peak 2024 inventories 578,016
- For some cases, this week’s active list is at 2015 yes 1,124,747
New listing data
The growth in new listings this year is a positive development, but lighter than I expected. If we can get the seasonal peak numbers to run between 95,000 and 110,000, I would consider this a home run year for new listings growth.Compare this data line to levels from 2008 to 2012 250,000 and 400000 WEEKLY: Obviously, we’re not seeing any sizable nationwide pressure on that data line.
In my perfect world, I’d like to see this year’s new listings numbers grow above 2022 levels during the peak season months, but so far that hasn’t happened. Since 2023 is the lowest number of new listings ever recorded, growth above last year doesn’t mean much. Hopefully we’ll get a pick-up in the weeks before seasonality kicks in and we’ll see a natural decline in new listings towards the end of the year.
Here are last week’s new listings data for the past few years:
- 2024: 67,530
- 2023: 59,072
- 2022: 83,812
Price reduction percentage
On average, one in three homes loses price every year—standard housing activity. When mortgage rates rise, demand falls and the price reduction percentage increases. When interest rates fall and demand improves, this percentage declines.
The price reduction percentage has increased year over year as inventory has increased, but it has not accelerated as much as it did in 2022. In 2023 and 2024, our market will be more normal.
- 2024: 34.%
- 2023: 30%
- 2022: 22%
10-Year Yield vs. Mortgage Rates
The 10-year Treasury yield has fallen recently but is now rebounding from key technical levels again 4.42%. We need to break this upward trend to see mortgage rates drop and stay lower. In a recent HousingWire Daily podcast, I discussed how we need to pay more attention to labor data and less to inflation. We have a jobs report coming soon which will be instructive, with bond yields rising on Friday.
The spread between 30-year mortgage rates and 10-year Treasury bond yields
Last year, mortgage spreads were the real negative mortgage rate story, as the banking crisis pushed spreads to new cycle highs, pushing mortgage rates higher. I thought spreads would get better closer to the first rate cut, but that didn’t happen and spreads improved sooner than I thought.Mortgage interest rates remain 0.75%-1.00% higher than normal levels for spreads.However, it could be worse: If spreads reach the worst levels we saw last year, mortgage rates will 0.52% Now higher.
Purchase application data
Seasonality in purchasing application materials is ending, as I typically measure this index from the second week of January through the first week of May. Traditionally, volumes always drop after May, so we only have a few weeks left. Over the past three weeks, we’ve seen slight weekly declines of 2%. Mortgage rates have been falling recently, so we’ll see what happens over the next few weeks. However, the first time we see at least 12 weeks of real growth is in late 2022 and early 2023.
Since mortgage rates began to fall in November 2023, we have 12 positive photos relatively 10 negatives and Two flat prints weekly. Once mortgage rates start to rise in 2024, some of the demand for mortgages is eliminated. As we can see, the year-to-date numbers aren’t even positive for 2024. six feature films, ten negative printing, and Two flat prints.
The week ahead: Fed speeches and home sales
We have several Fed presidents speaking this week, so wait for the market to digest specific sentences for hints on the Fed’s future policy. We will also publish home sales reports: Existing Home Sales and New Home Sales.
On Wednesday I will be at Yahoo Finance Discuss existing home sales report.Last week, I was CNBC Twice: once to talk about how exaggerated the story of underwater homes is, and once to discuss rising rents and their impact on the Fed. In terms of 10-year yields and mortgage rates, I’d like to see how the bond market reacts to the Fed speech and how it reacts to the next jobless claims data.
