Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.

Thursday:
• At 8:30 AM ET, The initial weekly unemployment claims report will be released. (WILL NOT BE RELEASED)

• At 8:30 AM, Chicago Fed National Activity Index for September. This is a composite index of other data.

• At 10:00 AM, Existing Home Sales for September from the National Association of Realtors (NAR). The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR. 
Housing economist Tom Lawler expects the NAR to report sales of 4.00 million SAAR for September.

• At 11:00 AM, Kansas City Fed Survey of Manufacturing Activity for October.<

Note: This index is a leading indicator primarily for new Commercial Real Estate (CRE) investment including multi-family residential.

From the AIA: ABI September 2025: Weakness persists at architecture firms

The AIA/Deltek Architecture Billings Index (ABI) score of 43.3 for the month is the softest reading since April and represents an increase in the share of firms reporting a decrease from August. In addition, inquiries into new projects remained flat for the second consecutive month, following growth over the summer, and the value of newly signed design contracts decreased for the 19th consecutive month. All of these indicators mean that the soft conditions that many architecture firms have been experiencing since late 2022 are likely to persist for the foreseeable future.

Recent revisions to work in the pipeline continue to erode as well. In the aftermath of the pandemic-induced downturn in 2020, architecture firm backlogs reached the highest levels we have seen since we started collecting that data regularly 15 years ago. Backlogs have gradually declined since the third quarter of 2022 and currently stand at an average of 6.1 months, down from 6.5 months at the beginning of the year. Backlogs are averaging just five months at firms with multifamily residential and commercial/industrial specializations, but stand at an average of eight months at firms with an institutional specialization. But despite the recent decrease in backlogs at firms, they still stand at levels nearly comparable to those before the pandemic.

Billings declined at firms in all regions of the country in September, except for firms located in the Midwest, where billings were essentially flat. Billings were softest at firms located in the West for the fourth consecutive month, where they have weakened the most over the last year. By firm specialization, business conditions were weakest at firms with an institutional specialization this month and continued to soften at firms with a commercial/industrial specialization, which reported conditions approaching growth over the summer.
...
The ABI serves as a leading economic indicator that leads nonresidential construction activity by approximately 9-12 months.
emphasis added

• Northeast (43.8); Midwest (49.8); South (47.9); West (40.6)

• Sector index breakdown: commercial/industrial (46.6); institutional (44.3); multifamily residential (47.2)

Click on graph for larger image.

This graph shows the Architecture Billings Index since 1996. The index was at 43.3 in September, down from 47.2 in August.  Anything below 50 indicates a decrease in demand for architects' services.
This index has indicated contraction for 34 of the last 36 months.

Note: This includes commercial and industrial facilities like hotels and office buildings, multi-family residential, as well as schools, hospitals and other institutions.

This index usually leads CRE investment by 9 to 12 months, so this index suggests a slowdown in CRE investment throughout 2025 and into 2026.
Multi-family billings have been below 50 for 38 consecutive months.  This suggests we will some further weakness in multi-family starts.

Today, in the Calculated Risk Real Estate Newsletter: 2nd Look at Local Housing Markets in September

A brief excerpt:

The NAR is scheduled to release September Existing Home sales on Thursday, October 23rd at 10:00 AM. The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR.

Housing economist Tom Lawler expects the NAR to report sales of 4.00 million SAAR for September.

September sales will be mostly for contracts signed in July and August, and mortgage rates averaged 6.72% in July and 6.59% in August (lower than for closed sales in July).

In September, sales in these markets were up 8.2% YoY. Last month, in August, these same markets were down 2.5% year-over-year Not Seasonally Adjusted (NSA).

Important: There were one more working days in September 2025 (21) as in September 2024 (20). So, the year-over-year change in the headline SA data will be lower than the NSA data suggests (there are other seasonal factors).
...
More local markets to come after the NAR release.

There is much more in the article.

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 0.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 17, 2025.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 0.2 percent compared with the previous week. The Refinance Index increased 4 percent from the previous week and was 81 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 5 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent compared with the previous week and was 20 percent higher than the same week one year ago.

“The lowest mortgage rates in a month spurred an increase in refinance activity, including another pickup in ARM applications. The 30-year fixed rate decreased to 6.37 percent and all other loan types also decreased,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The refinance index increased 4 percent, driven by a 6 percent increase in conventional refinances and a 12 percent increase in FHA refinance applications, as borrowers remain attentive to these opportunities to lower their monthly mortgage payment. VA refinances bucked the trend and were down 12 percent.”

Added Kan, “ARM applications increased 16 percent over the week, which pushed the ARM share to 11 percent, with the ARM rate more than 80 basis points lower than the 30-year fixed rate. Purchase applications were down over the week but remained 20 percent higher than a year ago.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) decreased to 6.37 percent from 6.42 percent, with points decreasing to 0.59 from 0.61 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.

The first graph shows the MBA mortgage purchase index.

According to the MBA, purchase activity is up 20% year-over-year unadjusted. 
Red is a four-week average (blue is weekly).  
Purchase application activity is still depressed, but above the lows of 2023 and slightly above the lowest levels during the housing bust.  

The second graph shows the refinance index since 1990.

The refinance index has increased from the bottom as mortgage rates declined.

Note: Mortgage rates are from MortgageNewsDaily.com and are for top tier scenarios.

Wednesday:
• 7:00 AM ET, The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

• During the day, The AIA/Deltek's Architecture Billings Index for September (a leading indicator for commercial real estate).

Here are a few photos from my trip to Patagonia:

Click on graph for larger image.

The first photo is at Cape Horn with a friend since high school. 
We were lucky to able to go ashore!

The albatross is a memorial to all the sailors that lost their lives sailing around the Cape.
Here is a poem on a plaque near the monument.

"I am the albatross that awaits you at the end of the world.
I am the forgotten souls of dead mariners who crossed Cape Horn from every sea on Earth.
But they did not die in the raging waves; today they fly on my wings toward eternity, in the last crevice of the Antarctic winds."
by Sara Vial


The second photo is at Torres del Paine National Park.

This shows the granite towers and horns.
The "horns" are sedimentary rock (black) on top of granite (gray).
The park is known for ferocious wind gusts - and it did not disappoint!









The third photo is also at Torres del Paine National Park.

This is at Gray Glacier Lake.

This lake is known for the bright blue icebergs - and there was a large one close to shore when we arrived.

"Paine" means blue in the indigenous language, so the park is named after the towers and the amazing blue lakes.

The wind was gusting up to 85 knots when I took this photo. You had to lean into the winds at times.

A great trip!

Today, in the Calculated Risk Real Estate Newsletter: Lawler: Early Read on September Existing Home Sales, and Update on MBS Yields and Spreads

A brief excerpt:

From housing economist Tom Lawler:

Early Read on Existing Home Sales in September

Based on publicly-available local realtor/MLS reports released across the country through today, I project that existing home sales as estimated by the National Association of Realtors ran at a seasonally adjusted annual rate of 4.00 million in September, unchanged from August’s preliminary pace (which looked too high relative to state and local realtor data) and up 2.6% last September’s seasonally adjusted pace. Unadjusted sales should show a larger YOY % increase, reflecting this September’s higher business day count relative to last September’s.

Local realtor/MLS reports suggest that the median existing single-family home sales price last month was up by about 2.2% from a year earlier.

CR Note: The NAR is scheduled to release September Existing Home sales on Thursday, October 23rd at 10:00 AM. The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR.

There is also an update on MBS Yields and Spreads in the article.

Catching up ...
The National Association of Home Builders (NAHB) reported the housing market index (HMI) was at 37, up from 32 last month. Any number below 50 indicates that more builders view sales conditions as poor than good.

From the NAHB: Amid Market Challenges, Builder Expectations Rise in October

Even as builders continue to grapple with market and macroeconomic uncertainty, sentiment levels posted a solid gain in October as future sales expectations surpassed the 50-point breakeven mark for the first time since last January.

Builder confidence in the market for newly built single-family homes was 37 in October, up five points from September and the highest reading since April, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today.

“While recent declines for mortgage rates are an encouraging sign for affordability conditions, the market remains challenging,” said NAHB Chairman Buddy Hughes, a home builder and developer from Lexington, N.C. “The housing market has some areas with firm demand, including smaller builders shifting to remodeling and ongoing solid conditions for the luxury market. However, most home buyers are still on the sidelines, waiting for mortgage rates to move lower.”

“The HMI gain in October is a positive signal for 2026 as our forecast is for single-family housing starts to gain ground next year,” said NAHB Chief Economist Robert Dietz. “The 30-year fixed-rate mortgage fell from just above 6.5% at the start of September to 6.3% in early October. Combined with anticipated further easing by the Fed, builders expect a slightly improving sales environment, albeit one in which persistent supply-side cost factors remain a challenge.”

With the government shutdown continuing and an expectation of no Census housing construction data for September being published this week, Dietz noted the following: “Based on modeling of historical data, the October increase for the HMI suggests an approximate 3% increase for the September single-family permit data on a seasonally adjusted annual rate basis. Our model suggests a 2% to 4% range for the increase based on the statistical relationship.”

In a sign of ongoing challenges for the housing market, the latest HMI survey also revealed that 38% of builders reported cutting prices in October. This share has alternated between 37% and 39% since June. Meanwhile, the average price reduction rose to 6% in October after averaging 5% for several months previously. The last time builders reduced prices by 6% was a year ago in October 2024. The use of sales incentives was 65% in October, unchanged from September.
...
All the HMI subindices rose in October. The component measuring current sales conditions increased four points to 38, the index gauging future sales jumped nine points to 54 and the gauge charting traffic of prospective buyers posted a four-point gain to 25.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose two points to 46, the Midwest was unchanged at 42, the South increased two points to 31 and the West gained two points to 28.
emphasis added

Click on graph for larger image.

This graph shows the NAHB index since Jan 1985.

The index has been below 50 for eighteen consecutive months.

Container traffic gives us an idea about the volume of goods being exported and imported - and usually some hints about the trade report since LA area ports handle about 40% of the nation's container port traffic.
The following graphs are for inbound and outbound traffic at the ports of Los Angeles and Long Beach in TEUs (TEUs: 20-foot equivalent units or 20-foot-long cargo container).

The first graph is the monthly data (with a strong seasonal pattern for imports).

Click on graph for larger image.

Usually imports peak in the July to October period as retailers import goods for the Christmas holiday and then decline sharply and bottom in the Winter depending on the timing of the Chinese New Year.  
Imports were down 7% YoY in September, and exports were down 2% YoY.    
To remove the strong seasonal component for inbound traffic, the second graph shows the rolling 12-month average.

On a rolling 12-month basis, inbound traffic decreased 0.6% in September compared to the rolling 12 months ending the previous month.   
Outbound traffic decreased 0.1% compared to the rolling 12 months ending the previous month.
This is the 10th consecutive month with exports down YoY.

From Matthew Graham at Mortgage News Daily: Another Boring Day With Mortgage Rates Near 3-Year Lows

[W]e're hanging out near 3 year lows with minimal volatility. In order to see sharper, more sustained momentum, we'd likely need the government shutdown to end. That would allow the most consequential economic reports (like the jobs report) to be released. It would also allow data collection to resume for future jobs reports.

Between now and then, there is other data to guide the rate market, but it's just not as heavy hitting. This week is particularly light in that regard, but there's one exception. The BLS received an exception to compile September's CPI inflation data, to be released this Friday. It's not quite on par with the jobs report, but it can certainly get rates moving (for better or worse, depending on the details). [30 year fixed 6.22%]
emphasis added

Tuesday:
• No major economic releases scheduled.

Today, in the Calculated Risk Real Estate Newsletter: California Home Sales Up 6.6% Year-over-year SAAR in September

A brief excerpt:

The NAR is scheduled to release September Existing Home sales on Thursday, October 24th at 10:00 AM. The consensus is for the NAR to report sales of 4.06 million SAAR. Last year, the NAR reported sales in September 2024 at 3.90 million SAAR.

California reports Seasonally Adjusted (SA) sales and some measures of inventory whereas most of the local is Not Seasonally Adjusted (NSA).

From the California Association of Realtors® (C.A.R.): California home sales rebound in September with modest monthly and annual gains, C.A.R. says

After five consecutive months of year-over-year declines, September home sales activity climbed 5 percent from the 264,240 homes sold in August and rose 6.6 percent from a year ago, when 260,340 homes were sold on an annualized basis. September marked the 36th straight month in which the seasonally adjusted sales rate remained below the 300,000 benchmark. ...

This is in line with national sales being up year-over-year.

There is much more in the article.

Altos reports that active single-family inventory was up 0.3% week-over-week.  Inventory usually starts to decline in the fall and then declines sharply during the holiday season.
The first graph shows the seasonal pattern for active single-family inventory since 2015.
Click on graph for larger image.

The red line is for 2025.  The black line is for 2019.  
Inventory was up 16.1% compared to the same week in 2024 (last week it was up 17.0%), and down 8.1% compared to the same week in 2019 (last week it was down 9.5%). 
Inventory started 2025 down 22% compared to 2019.  Inventory has closed more than half of that gap, but it appears inventory will still be below 2019 levels at the end of 2025.
This second inventory graph is courtesy of Altos Research.
As of October 17th, inventory was at 859 thousand (7-day average), compared to 857 thousand the prior week. 
Mike Simonsen discusses this data and much more regularly on YouTube

Note: CR is on vacation until Oct 21st.
This is the 21st year I've been writing this blog!
Starting in January 2005, I was very bearish on housing - and in early 2007, I predicted a recession.

However in 2009 I became more optimistic. For example, in February 2009, I wrote: Looking for the Sun (Note: that post shocked many readers since I had been very bearish).

A few years later, in early 2012, when many people were still bearish on housing, I called the bottom for housing: The Housing Bottom is Here

Then I spent a number of years arguing against the recession callers, and the new housing bubble calls. A few examples:
In 2015, I wrote The Endless Parade of Recession Calls

For the last 6+ years, there have been an endless parade of incorrect recession calls. The most reported was probably the multiple recession calls from ECRI in 2011 and 2012.
...
I disagreed with that call in 2011; I wasn't even on recession watch!

And I updated that post several times.
And on housing, over seven years ago, in January 2018, I was quoted in a Bloomberg article:

Bill McBride, who runs the Calculated Risk blog and also called the crash, doesn’t think home prices are inflated this time around. Unlike in 2005, lenders are acting responsibly and the Wild West of real estate speculation hasn’t returned, he said. There is less to speculate on, too. Compared with the overbuilding that preceded the bust, today’s pace of construction isn’t fast enough, he said.

“Lending standards are still pretty good,” McBride said, and he doesn’t expect mortgage rates to “take off” in the short term.

And in December 2018, I disagreed with Professor Shiller A comment on Professor Shiller's "The Housing Boom Is Already Gigantic. How Long Can It Last?". My conclusion:

No big deal, and definitely not a "gigantic" boom in house prices.

In 2021, I wrote: Is there a New Housing Bubble?

The lack of wild speculation doesn't mean house prices can't decline, but it means that we won't see cascading declines in prices like what happened when the housing bubble burst.
...
From a historical perspective, house prices are high. But lending standards have been solid, and we haven't seen significant speculation - so I wouldn't call this a bubble.

Also in 2021, I started my real estate newsletter.  
Note: for $25 you can read the entire archive and one month of daily posts - but make sure you cancel or substack will bill you every month! For $100, you will usually receive 4 to 6 articles per week for a year, you can read the archive and comment on all the posts.
A few key articles:
Housing and Demographics: The Next Big Shift
Housing: Don't Compare the Current Housing Boom to the Bubble and Bust
Household Formation Drives Housing Demand
The Long-Term Housing and Population Shift
Stay tuned!

NOTE: I'm on vacation and returning this week. Government data might be rescheduled due to the government shutdown.

The key economic report this week is September Existing Home sales.

For manufacturing, the Kansas City Fed manufacturing survey will be released this week.

----- Monday, October 20th -----
No major economic releases scheduled.

----- Tuesday, October 21st -----
No major economic releases scheduled.

----- Wednesday, October 22nd -----
7:00 AM ET: The Mortgage Bankers Association (MBA) will release the results for the mortgage purchase applications index.

During the day: The AIA/Deltek's Architecture Billings Index for September (a leading indicator for commercial real estate).

----- Thursday, October 23rd -----
8:30 AM: The initial weekly unemployment claims report will be released. 

8:30 AM ET: Chicago Fed National Activity Index for September. This is a composite index of other data.

10:00 AM: Existing Home Sales for September from the National Association of Realtors (NAR).  

The graph shows existing home sales from 1994 through the report last month.

11:00 AM: Kansas City Fed Survey of Manufacturing Activity for October.

----- Friday, October 24th -----
No major economic releases scheduled.

From March 2013: Business Cycles and Markets

I've been asked several times about the recent ECRI recession call (obviously I disagreed with their incorrect recession call in 2011 - I wasn't even on recession watch then and I'm not on recession watch now - and I also think ECRI is wrong about a recession starting in mid-2012). ...

It seems to me ECRI is trying to make this an academic exercise and hoping for some significant downward revisions. Right now the data doesn't indicate a recession in 2012, but, as Menzie Chinn notes, "all of these series will be revised, so one wouldn’t want to state definitively we are not in a recession – therein lies the path to embarrassment. But the case still has to be made for recession."

But why do we care? ...

Why is there so much focus on the business cycle? For companies, especially cyclical companies, the reason is obvious – it helps with planning, staffing and investment.

But why are investors so focused on the business cycle? Obviously earnings decline in a recession, and stock prices fall too. The following graph shows the year-over-year (YoY) change in the S&P 500 (using average monthly prices) since 1970. Notice that the market usually declines YoY in a recession.
...
So calling a recession isn’t just an academic exercise, there is some opportunity to preserve capital.

Note: From June 2015: ECRI Admits Incorrect Recession Call

CR Note: I will be returning on October 21st (unless I change my mind or get lost), and I should start posting soon. Best to all!

Note: CR is on vacation, and I will return on October 21st.

In 2005 and 2006, I was researching previous housing bubble / busts to try to predict what would happen following the bursting of the housing bubble.

So, in April 2008, when many pundits were calling the housing bottom, I wrote: Housing Bust Duration

After another year (or two) of rapidly falling prices, it's very likely that real prices will continue to fall - but at a slower pace. During the last few years of the bust, real prices will be flat or decline slowly - and the conventional wisdom will be that homes are a poor investment.

The Los Angeles bust took 86 months in real terms from peak to trough (about 7 years) using the Case-Shiller index. If the Composite 20 bust takes a similar amount of time, the real price bottom will happen in early 2013 or so.

And then in February 2012 I wrote: The Housing Bottom is Here

There are several reasons I think that house prices are close to a bottom. First prices are close to normal looking at the price-to-rent ratio and real prices (especially if prices fall another 4% to 5% NSA between the November Case-Shiller report and the March report). Second the large decline in listed inventory means less downward pressure on house prices, and third, I think that several policy initiatives will lessen the pressure from distressed sales (the probable mortgage settlement, the HARP refinance program, and more).

And in March 2013, I wrote about the two bottoms - one for activity and the other for prices: Housing: The Two Bottoms

I pointed out there are usually two bottoms for housing: the first for new home sales, housing starts and residential investment, and the second bottom is for house prices.
...
[I]t appears activity bottomed in 2009 through 2011 (depending on the measure) and house prices bottomed in early 2012.