The Fed meets this week and the market is growing less sanguine about interest rate cuts.

What happens to the housing market if mortgage rates actually go up from here?

Inventory is growing and will continue to grow. Are there risks that supply and demand grow out of balance?

I don’t have ability to forecast mortgage rates, but we do know exactly how the housing market will behave if rates jump or fall from here. That’s what we’re discussing in this week’s Altos Research real estate market video.

[Video link follows the thread]

1/7 Inventory
📍507,000 single family homes are on the market in the US
📍That’s 1.3% more than last week, 22% more than a year ago, and 105% more than two years ago.
📍This week in 2022 was the last of the 3% mortgages. Inventory and rates rose in lockstep starting then. In the Inventory chart below see the rightmost red section that highlights the last two years of rising rates and rising inventory.
📍In the next quarter if rates finally fall, say to the mid-6s, this inventory expansion trend will reverse.

2/7

Monday @AltosResearch real estate data thread!

More sellers, fewer buyers.

Mortgage rates hit 7.2% last week.

Inventory of unsold homes subsequently increased this week for the first time all year.

Price reductions ticked up too for the first time since November.

Some of the home price signals are softening as potential home buyers are faced with higher for longer mortgage rates.

These are the details we’re reviewing in this week’s housing market data video.

[video link follows the thread]

1/7 Inventory

📍There are now 498,000 single family homes on the market in the US.
📍That’s almost 1% more than last week, and now 16% more than last year at this time.
📍This is the first inventory increase of the year.
📍Mortgage rates are up sharply from last year so inventory is too
📍In the Inventory chart below, the red periods are when rates and inventory were rising. The green sections are when rates and inventory were falling.

2/7

Monday housing thread!

With mortgage rates now back in the 7s, demand is slowing and it seems like some home price signals are softening.

We have more sellers entering the market than last year at this time. We can see mortgage rates slow demand. And as demand slows, inventory grows.

More supply should lead to more home sales in 2024. And sales have indeed been slowly rising, but this has unreliable week to week. It’ll be important to keep our eyes on the pending sales rate to know if supply is outpacing demand.

These are the details we’re reviewing in this week’s Altos Research real estate market data.

[video link follows the thread]

1/7 New Listings

📍There were 63,000 new listings this week, of which 13,000 are already in contract which leaves 50,000 new listings adding to inventory.
📍That’s 16% more sellers than last year at this time. This is the same trend we’ve been reporting for a few months and a big reversal from last year.
📍While sellers are finally coming back from 2023’s anemic market, it’s still not a lot of sellers.
📍In the New Listings chart below, the gray lines are previous years. See this year climbing, but a lot fewer sellers than pre-pandemic seasons.

2/7

Will existing home sales break above 4.2 million? Fall below 4 million?

That's what we're looking at in this week's @AltosResearch market video.

We dive into the weekly pending sales as well as inventory and prices.

Video links below 🧵📽️👇

1/8 There are 378k single family homes in contract.

These are homes that will sell in July, August, September when the transaction closes.

In the weekly data you can see that the pace of sales is holding up, where last year at this time it had started falling quickly

2/8

Are 7% mortgage rates finally impacting home buyer demand?

I explore some of the signals in today's @AltosResearch market video. Details 👇

📍Inventory of single family homes for sale is inching up. 451,000. Still supply constrained. Only 7% more homes on the market vs '22

1/6 We always look for demand signals in the price reductions data. And maaaybe some early signs that fewer homes are getting their offers.

📍31.4% of homes on the market have taken a price cut.
📍Price cuts accelerated just a touch more than expected this week.

2/6

Today's @AltosResearch video covers the unusual supply/demand dynamics driving real estate right now.

It's mid-May and inventory is not rising. Still only 420k single family homes on the market.

Last year demand slowed so quickly that inventory was rising 4-5% per week!

1/7 Only 81,000 new single family listings. 17% fewer new sellers this week than last year.

And our immediate sales tracker shows 23% of those are already in contract. The light portion of each bar are the immediate sales

Normal spring demand rolling faces tight supply.

2/7

By April 1, 2020 we could see the first surprising signals of housing demand in the data.

This year is surprising too. Not as dramatic, but still...

Currently only 30.5% of the market has had a price cut. Big change from Q4.

This week's @AltosResearch video 🧵📽️👇

1/7 Surprising demand is being met with limited supply.

Only 410,000 single family homes on the market. Down almost 1% from last week.

The further in to Q2 we go without substantial inventory increase means it's less likely that we'll emerge from our shortage this year.

2/7

Available inventory of homes for sale is still falling.

Sellers simply aren't keeping up with demand.

Inventory of single family homes fell by 2.5% this week to 418k. The fewest since last June.

The @AltosResearch housing market video has the deets. 🧵📽️👇

1/7 Slight increase in the new listings this week. Still fewer than last year.

Immediate sales picked up too. 18,000 homes got listed and went into contract right away. 24k last year at this time.

There's just no sign of any surge in inventory anywhere in the country.

2/7

Whither home prices for 2023? Tons of signal in the data now.

Median home price in the US is $420k
New Listings: $399k, flat YoY
Pendings: $370k, flat/down YoY

Home sales headlines will start to report ⬇️HPA in a few months

Deets in this @AltosResearch video
📽️🧵👇

1/6 Even as mortgage rates climb and demand backs off again, this is a supply-constrained market.

Inventory is down by 1.5% this week to 430k single family homes.

One more week of falling inventory before finally, Spring?

2/6

A California state senator asked me yesterday:

Since the Bay Area population has shrunk back down to 2010 levels, why haven't home prices fallen?

Here's what I shared with him:

1/

marketwatch.com/story/the-sili… Home prices in the SF Bay Area have indeed fallen. Median price of single family homes in the Bay are $1.18M down from $.133M two years ago.

This yearly chart illustrates is pretty well.

2/

Homebuyers are defying expectations. And sellers are not eager to sell.

Available inventory of single family homes for sale dropped by 3% this week to only 443k

46% fewer homes on the market than in 2019

We cover all the details in this week's @AltosResearch video 📽️🧵👇

1/7 Only 58k new listings this week vs. 67k last year at this time.

Last year more were gobbled up immediately of course when rates were still in the 3s.

It's going to be hard to inventory to get anywhere close to pre-pandemic normals with sellers refusing to sell.

2/7

2023 housing market is set to make or break with mortgage rates

Inventory is falling, but we probably only have 6(!) more weeks of declines before the spring starts climbing

549k single family homes on the market, down 2.5% post TDay.

Here's @AltosResearch video 📽️🧵👇
1/7 Very few new listings each week and almost no immediate sales anymore.

30% fewer new listings volume than last year at this time

Sellers are holding out as much as buyers are

Will see a little rebound next Monday

2/7

Seeing unprecedented inventory gains in homes for sale for late October.

Available supply grew by 1% this week, normally inventory shrinks by 1-2% per week.

572k homes on the market

7% mortgage rates stopped the market cold. Here's this week's @AltosResearch video 🧵📽️👇

1/6 As a result of the unseasonal gains, our projection for EOY inventory increased to 510,000 single family houses.

Even though inventory hasn't stopped climbing, we still expect it to decline a bit for the holidays. (Maybe?!)

See the inflection when rates spiked September 1

2/6

Today is my mother's 83rd birthday.

Here's a short thread on the things this incredible woman did during her 82nd year: My 83 year old mother captained a 40-foot catamaran for a family sailing trip in Martinique.

This is her driving the boat in a driving rainstorm.

Home prices holding steady as a few more homes hit the market this week

A little bounce in inventory up to 552,000 single family homes unsold on the market

26% more homes than last year

43% fewer than 2019!

Here's the @AltosResearch real estate market data video. 📽️🧵👇

1/7 You can see 2022's crazy year in the chart of the new listings each week

These are those that hit the market and didn't sell immediately

63,000 new SFR listings this week

The curve shows us how we'll not break out of our crisis shortage any time soon

2/7

Available inventory of homes for sale surprises again this week!

Supply fell 1% to 547,000 SFR

Let's look at how all this plays out in this week's @AltosResearch #realestatemarket video 🧵📽️👇

1/7 There's just a remarkable dearth of new listings.

25% fewer new listings each week than we'd expect for this time of year

The portion selling immediately (light red part of each bar here) is finally evaporating.

2/7

Available inventory of homes for sale is now declining for the season.

553,000 single family homes on the market.

Prices ticking down too.

This week's (belated!) @AltosResearch real estate market update 🧵📽️👇

1/6 We'll quite obviously finish 2022 with fewer than 500,000 single family homes on the market.

Will homeowners *ever* unload their amazing investments?!

Buyers will face a pretty severe shortage again next year 😰

2/6

Will home buyers ever get that bargain market they've been waiting for?

Looking less likely, TBH

Available inventory of unsold single family homes rose 1% this week to 550k.

Supply just isn't increasing enough

This week's @AltosResearch real estate market data 🧵📽️👇

1/6 Inventory is still rising but rising less even than last year at this time

Looks now like we'll peak at 600k and finish the year at maybe 525k single family homes on the market

We revised this projection down a bit from just a few weeks ago

2/6

Will the real estate market see a soft landing? It's starting to look like that!

Inventory growth is slowing

544,000 single family homes on the market

Less than 1% more than last week

This week's @AltosResearch real estate market data 🧵📽️👇

1/7 If we look at the same data in YoY format, we can see how the slope has changed in the last few weeks.

Even allowing for decent jumps in inventory weekly in August, we'll still end the year with only 535k houses on the market.

Do we have to revise this forecast DOWN?!

2/7

Inventory growth sure looks to be slowing

Still a lot of homes hitting the market for July, but 3% more per week down from 6-8% in June

525,000 single family homes on the market

All the details in this week's @AltosResearch real estate market video

📽️🧵👇

1/6 To end the year with more than 550,000 homes on the market, we'd need to be posting record breaking weeks now. We're not.

Each bar here is a week of inventory change. The brown section are the forecasts for each week thru end of 2022.

5-6 more weeks of pretty big gains.

2/6

Is the inventory spike starting to slow?

Where does that leave the real estate market for 2023?

Exploring those questions in this week's @AltosResearch video.

Inventory rose 3.6% this week to 509,000 SFR.

30% more homes on the market than last year.

🧵📽️👇
1/7 Expect 5-7 more big inventory increase weeks this summer

On our way to start 2023 with approx 535,000 homes available

Buyers will have more selection, but not a *lot*

2/6