America’s two largest brokerages are merging: @Compass will have 340,000 real estate professionals once the Anywhere deal closes

Compass just armed itself for a showdown with @zillow

Here's what it means for the housing market
resiclubanalytics.com/p/two-largest-… In April, Zillow banned listings from appearing on its site if they had been marketed privately for more than 24 hrs before hitting the MLS

The policy was aimed at Compass—which has “Private Exclusives” that circulate inside its agent network before going public

Redfin: U.S. housing market now 508,715 more home sellers than homebuyers

That’s the most home sellers have outmatched homebuyers in over a decade, according to Redfin During the Pandemic Housing Boom, housing demand surged rapidly amid ultralow interest rates, stimulus, and the remote work boom—which increased demand for space and unlocked “WFH arbitrage."

Goldman Sachs issues a big revision to its home price forecast

GS expects U.S. home prices to rise +0.2% in 2025, and +0.8% in 2026 That’s according to @calculatedrisk. I haven’t seen the report yet.

I’m reaching out to get it now.

Source: Lennar “just fired 30 plus people from the Charleston Division a couple weeks ago”

Another source: Lennar “eliminated a large number of their team members in GA” A third industry source in my DMs confirms Lennar’s June layoffs in GA

A fourth industry source in my DMs says “Lennar cuts were nationwide”

U.S. housing market now has 500,000 more home sellers than homebuyers

That’s the most homebuyers have outmatched home sellers in over a decade, according to Redfin During the Pandemic Housing Boom, housing demand surged rapidly amid ultralow interest rates, stimulus, and the remote work boom—which increased demand for space and unlocked “WFH arbitrage."

Mortgage rates are clearly a big focal point for new Treasury Secretary Scott Bessent Case in point No. 1

https://twitter.com/NewsLambert/status/1887363804541165744

Fewer Americans are living together

I expect the housing market to continue shifting toward smaller household counts

1-person households will keep rising

This will be one of the most impactful housing trends of the 21st century

Chart via @ResidentialClub There are 3 main drivers

IF U.S. incomes spiked 60%, we'd return to pre-pandemic housing affordability levels

IF U.S. home prices fell 38%, we'd return to pre-pandemic affordability

IF mortgage rates fell 4.7 points (from 6.93% to 2.23%), we'd return to pre-pandemic affordability

via @FannieMae To be clear, the "IFs" in my top tweet don't mean that I think these are possible paths.

Instead, it's how far Fannie Mae says the given metric on paper would have to shift in order to return housing affordability to 2016-2019 levels.

D.R. Horton forecast 2025 revenue and home deliveries below estimates today. That pushed homebuilder stocks down.

In terms of margins, D.R. Horton is still above pre-pandemic levels despite making adjustments in some markets to keep sales going

https://x.com/ResidentialClub/status/1851409168894189704

With today's 7% stock decline, D.R. Horton's share price is up 10% on the year

The mortgage market is experiencing a severe recession

It's one of the worst mortgage downturns in history

Mortgage purchase apps are at the lowest levels of the post 1995 era

Many would-be sellers can't afford to sell & buy something else at current rates—lock-in

Thread 🧵 Traditional refi is RIP right now

"Economy good = people buy houses. Economy bad = people refinance houses. We [loan officers] win every time. Just not this time" -@AdvisorJohn

In the 2007-12 bust, purchases fell off while refi kept going

Right now, both are pinned down

JPMorgan economists: A secular housing shortage in the U.S. has thus far prevented a pullback in housing construction employment induced by spiked interest rates

"even after accounting for lags, we document below that housing starts and construction employment should already be quite a bit lower than where they are now" When it comes to Fed-induced recessions, employment in residential building construction typically starts declining well before the recession takes hold.

https://x.com/NewsLambert/status/1587809011214213120?s=20

The mortgage market is experiencing a severe recession.

It's one of the worst downturns in mortgage market history.

Traditional refi is RIP right now.

And this week, mortgage purchase apps hit the lowest level of the post 1995 era.

Thread 🧵 Layoffs (and mergers) are mounting in the mortgage industry.

Just ask @mortgagetruth.

Back in Feb. 2007, he started tracking mortgage layoffs and closures. He's back at it this cycle... and the list is growing—fast. thetruthaboutmortgage.com/a-list-of-rece…

Meet the epicenter of institutional home buying 🏡👇

Atlanta.

While institutional firms own 0.73% of the U.S. single-family stock, they own 4.4% in Atlanta, finds @ParclLabs
resiclubanalytics.com/p/regional-hou…
According to @ParclLabs, 36.8% of all institutional-owned homes can be found in just 6 markets: Atlanta (where 13.3% of institutional-owned homes can be found), Phoenix (5.4%), Dallas (5.4%), Houston (4.3%), Tampa (4.2%) and Charlotte (4.2%)
resiclubanalytics.com/p/regional-hou…

Austin home prices have further to fall

During the '00s crash, it took Austin 30 months to fall 6.7% peak-to-trough

This time around, Austin has fallen 11% in just 14 months

How did Austin—which dodged the worst of the 08 crash—become the epicenter of the pandemic correction? Among the 385 major housing markets tracked by Freddie Mac, only 35 markets are still down +3.00% from their pandemic peak.

Austin is down the most (-11%)

Keep in mind, that national home prices, as tracked by the Freddie Mac House Price Index, set a new all-time high in July.

Inventory drop day 🏡📊

These are markets you all requested yesterday (I'm done taking requests).

Let's start with the nation's largest housing market: New York. Inventory in L.A.

The U.S. housing market isn't just bifurcated by region.

It's also bifurcated within regional markets.

Just look at San Jose, where "upper price tier" homes are down 9.05% from peak while "lower price tier" homes just set a new all-time high in July 2023. As mortgage rates spike/housing affordability deteriorates, buyers lower their expectations thus keeping the bottom half of the market warmer than the top half.

In March 2022, Zillow predicted that the biggest U.S. home price uptick still awaited, and that by February 2023 prices would be up another 17.8%.

At the same time, Zillow was offloading its remaining "flips" in overheated markets at peak prices. Even as the mortgage rate shock was clearly manifesting, Zillow argued in spring 2022 that home price appreciation had a lot of gas left in the tank & wasn't normalizing.

The Pandemic Housing Boom saw U.S. home prices jump over 40% in just over 2 years.

It takes time for property taxes to catch up. But it’s coming.

Look no further than Butler County, Ohio where residents are staring down a very big property tax hike.
wcpo.com/news/local-new… Local officials realize this is politically dangerous for them.

In the article above, Butler County OH officials are scrambling to see if they can do anything to lighten the looming property tax hikes.

#NEW Invitation Homes—the largest owner of U.S. single-family rental homes—was a net seller for the third straight quarter.

It sold off more homes (378 homes) than it acquired (276 homes) in Q2 2023. That said, it's likely that Invitation Homes will be a net buyer again—at least for the third quarter of 2023.

The historic deterioration in housing market affordability, as told by one chart.

It was a one two punch: Overheated house price growth (March '20 to June '22) followed by last year's mortgage rate shock (going from 3% to 7%) If you're on Meta's new site, you can find me at "newslambert"

The CEO of Fortune 500 homebuilder D.R. Horton reveals how he cornered the housing market amid a historic affordability squeeze.

Here's my Q&A with @DRHorton CEO David Auld.
fortune.com/2023/07/01/hou… Despite the mortgage rate shock, @DRHorton just moved up to its highest ever ranking on the Fortune 500 list (No. 120).

via @FortuneMagazine