When analyzing last week’s data, it is important to consider various factors. While pending home sales did show a rebound, the actual level may not be as high as the data suggests. This trend is also reflected in our new listings and inventory data. Let’s delve into the details.
Weekly pending sales
The existing home sales report from last week indicated a 4.1% year-over-year increase in demand.
I had previously mentioned that if the sales trend remains around 4 million, we should expect growth for several months, especially from June to October. This forward-looking housing data has indeed been better than last year, resulting in positive year-over-year reports from July to November. Although the growth in our weekly sales data since May is not significant, it is still a positive sign.
While our weekly pending sales have increased, the actual numbers may not be as high as shown:
- 2025: 67,757
- 2024: 58,966
Our new listings data has experienced an unusual increase for this time of year, which is expected to normalize in the upcoming week. It’s important to note that most home sellers are also buyers. While the recent stabilization in this data is encouraging, the sudden spike is abnormal, similar to the weekly pending home sales data.
Our price-cut percentage data has been relatively stable in recent months and has even slightly declined. It is currently lower than the levels seen in 2022. Although there was a slight decline in the data last week, it’s important to approach this data cautiously.
We anticipate some normalization in the data this week, amidst the backdrop of the government shutdown.
Purchase application data
For the past 12 weeks, we have seen positive growth in purchase applications, with 38 consecutive weeks of positive year-over-year data and 25 consecutive weeks of double-digit growth. While a sustained period of positive weekly purchase application data is desired, recent weeks have shown some negative trends. The impact of the government shutdown on this data is also being explored.
- 19 positive readings
- 16 negative readings
- 6 flat prints
- 38 straight weeks of positive year-over-year data
- 25 consecutive weeks of double-digit growth year over year
Weekly housing inventory data
While housing inventory initially peaked at a yearly high, recent data shows a slowdown in inventory growth. The seasonal decline in inventory is expected to commence soon.
- Weekly inventory change (Oct. 17-Oct. 24): Inventory rose from 859,419 to 867,811
- The same week last year (Oct. 18-Oct. 25): Inventory fell from 739,401 to 735,961
Mortgage rates and the 10-year yield
The current mortgage rates and 10-year yield are near their lows, with labor data playing a significant role in keeping them suppressed. While mortgage rates ended the week at 6.19%, there is potential for a slight increase. The mortgage spreads have also been favorable, with room for improvement.
Mortgage spreads
Historically, mortgage spreads have ranged between 1.60% and 1.80%. Current spreads indicate favorable mortgage rates, with room for further improvement.
The week ahead: Fed week, bond auctions, pending home sales, Fed speeches and home prices
This week is filled with economic events, including Fed week, bond auctions, pending home sales data, Fed speeches, and home price indexes. The Fed’s decision on rates and the accompanying statements by Jerome Powell will be closely watched. Bond auctions and pending home sales data will provide insights into the market’s current state.
Additionally, home price indexes are expected, reflecting a lag in the market’s price shifts. With recent reports showing an uptick in median sales prices, the upcoming week promises further developments in the housing market.