Mike Simonsen

Maryland is just playing catch up!

Doing some work with the Compass data team today. Thought this looked cool

Looking at the MBA purchase mortgage applications on a 13-week rolling average really highlights the current trend

Such excellent insight and a fascinating story!

Existing home sales are inching above last year as reported by NAR.

In our weekly pending contracts, the slight growth over 2024 continues.

Last year the brief mortgage rate dip to 6.1% in September lifted the sales rate for Q4. Will be interesting if we can beat that this year.

Interesting that LA is less affordable than SF in your set. Is that because LA renters have significantly lower income?

New home sales big print feels like survey noise to me. What would be the sudden catalyst?

Existing Home Sales tomorrow from NAR should show YoY gains but nothing in the real-time data says massive shift.

Some millennial will thank you for the infill opportunity.

An interesting comment @mikesimonsen.bsky.social made in his weekly housing video for Compass this week is the sellers withdrawing listings aren’t those with tons of equity, it’s ones who bought more recently who don’t have that equity cushion and can’t afford to take a lower asking price.

Unaffordable by Design: What’s Next for America’s Intractable Housing Crisis? An exclusive dive into the roots of America’s housing affordability crisis — revealing how we got here and what it will take to chart a new path forward.

If you’d like to read more detail, I authored this Report in May:

www.housingwire.com/articles/una...

In specific, you keep referencing data from several years ago.

Wall Street funds are in fact net sellers of homes right now.

So to the extent that they deserve blame for home price increases during the free money era, they deserve credit now for dropping prices in the towns where prices are down

The result is that we support existing home owners and their prices. To the detriment of those who don’t yet own.

I’m of the view that blaming Wall Street for the crisis is myopic and naive, when really we should be blaming “Americans.”

But those policies: eg zoning laws, low taxes, environmental laws, foreclosure prevention all exist for “good” reasons.

We don’t want to kick grandma out of her house because of high taxes.
We don’t want to build on every square inch of land…

Because we’re so favorable to owners, real estate has been a great investment in that time.

Wall Street is a tiny tiny portion of the investor class. That money was what pulled us out of the GFC finally!

There are lots of policy changes we should make to fix the crisis.

Look, you’re not alone in seeking blame for our affordability crisis and there’s no more ready-made-villain than “Wall Street Landlord.”

But in fact we have 60 years with every law, tax, policy in the US inflating home prices to help homeowners, to the detriment of those who do not yet own.

Furthermore, investors are an important and valuable part of the housing economy.

Most renters are not in a position to buy. They *need* rental homes to rent!

It is a misinterpretation to assume that if an investor buys a house that means a homeowner cannot.

No, Wall Street investors are not buying up a bunch of homes The share of institutional investors buying houses is even lower in 2024 than last year, when it was nowhere near the reported 44%.

Investors is not the same a “Wall St”

Only 4% of all investor purchases are firms with more that 1000 homes.

96% of investor purchases are people who own 1-4 homes. Otherwise known as “Americans”.

www.housingwire.com/articles/no-...

My guess is you’ll barely notice it. We’ve been anticipating the Silver Tsunami for at least a decade. Boomers are still net buyers of real estate. They don’t want to sell ever. At some point the grandkids will get a house or two.

I assume you shared that bc you think that “Wall Street” is keeping prices artificially high?

Alas, nope. Wall Street owns a tiny fraction of the homes. Like 1%. In fact the towns like Tampa and Phoenix where those companies invested the most money are the markets where prices have dropped the most

YouTube video by Compass Why Home Prices Aren’t Falling Like You Might Expect

7/7 Some buyers are waiting for lower rates and lower prices. The data says they may get one or the other but both may be elusive.

This week's video:

youtu.be/r_kNzYC7J0Y?...

6/7 We see it in the price reductions too.

41.5% of the homes have taken a price cut from the original list price. That level isn't increasing.

5/7 This "downside stickiness" psychology is a key reason for price stability.
This week, the median price of new pending contracts ticked up to $397,500, coming in almost 2% above the same week last year.

4/7 But here's the interesting part:

Even with limited supply, newly pending sales were up almost 5% from last year this week. We counted 77,000 sales contracts started this week.
More transactions are getting done in states with more available inventory.

3/7 New listings are down and withdrawals are up.

This week we counted just over 66,000 newly listed single-family homes, 5% fewer than a year ago.

This 90-day rolling average shows the trend clearly.

2/7 Data shows this in action:

National inventory has been unchanged at ~860,000 single-family homes since July. Last year it was rising quickly.

Why aren't home prices falling like you might expect now?

It's what Chip Case called "downside stickiness." When the market slows, sellers don't want to sell at a loss, so they withdraw listings, which keeps supply limited.

That's what we're seeing now. THREAD 📽️🧵👇

hopefully we have rates near 6 in the coming months!

Everyone's talking Fed of course, but the real news of the day may be the new construction data

Title: Days on Market per State — U.S. Median Days for Single-Family Homes U.S. map with states color-coded and labeled by median days on market (DOM) Color legend / scale: Medium blue: 42–49 days Light blue: 56–63 days Light red/orange: 70–77 days Darker red/orange: 84–98 days State values (selected): 42 days: Ohio, Indiana, Illinois, Wisconsin 49 days: Michigan, Massachusetts 56 days: Pennsylvania, Virginia, Minnesota, Maine 63 days: Washington, California, North Dakota 70 days: Utah, Nevada, New Mexico, Arizona, Oklahoma, North Carolina, South Carolina, Georgia 77 days: Oregon, Montana, Texas 84 days: Alabama 91 days: Florida, Louisiana, Mississippi 98 days: Hawaii Source: Altos Research, Compass; median days on market for single-family homes.

days on market context H/T @mikesimonsen.bsky.social

Three observations that continue to surprise me
A) Waymo taxis are just incredible
B) Tesla has a long way to catch up
C) maga is a deeply decel movement