March 26 2025

Reef Daily

Reef Daily | March 26 2025

Latest Market Data (March 26, 2025)

New single-family housing inventory jumped 34% year-over-year to 121,000 units (highest since July 2009)
Total nationwide inventory at 494,000 houses, representing 8.4 months of supply
S&P CoreLogic Case-Shiller Index shows home prices rose 4.1% in January year-over-year
Median price of new single-family houses at $414,500 in February, down 10% from October 2022 peak
Regional Distribution: The South and West account for 84% of new house inventory
Western Region Alert: Inventory in the West has reached highest levels since 2007

Construction Activity

Building permits decreased 1.2% to 1.456 million in February 2025
Single-family permits fell 0.2% while multi-unit permits dropped 4.3%
Regional building activity variations: Northeast (-15.3%), West (-7.6%), South (+1%), Midwest (+8.9%)

Current rates as of March 26, 2025:

Future Forecasts

Economists predicting market slowdown due to increasing inventory levels
Federal Reserve maintained current interest rates but projects two rate cuts in 2025

Commercial Highlights

Beacon Capital Partners purchased a 36-story office tower at 333 W. Wacker Drive in Chicago for $125 million (highest-priced deal in downtown Chicago in over two years)
Ocean State Job Lot acquiring 15 Big Lots locations across eight states, demonstrating continued strategic repurposing of former retail sites
Commercial financing: Five deals totaling $3.8 billion priced recently, bringing total CMBS and CRE CLO issuance in 2025 up to $40.1 billion—a 114% increase versus the same period in 2024

Regional Activity

West: Argent Development launched home sales at Liberty Ranch in Sacramento County (356-acre community with 1,440 planned homes across 27 residential villages)
West: Toll Brothers opened new model homes in Painted Prairie (Aurora, Colorado), featuring three-story luxury townhomes starting in the upper $300,000s
West: Century Complete announced Grand Opening for Antelope Park in Prescott Valley, Arizona, offering homes from the low $400s

Inventory Trends

Completed new single-family houses for sale increased by 34% year-over-year
Supply at 8.4 months was up by 6% from a year ago and by 40% from February 2019
Despite completions reaching 1.6 million in 2024, the U.S. still faces a 3.8 million home shortage

Economic Outlook

Consumer confidence dropped to a 12-year low in March 2025 (fourth consecutive monthly decline)
Federal Reserve revised growth forecast down to 1.7% (from 2.1%)
Atlanta Fed's GDPNow estimate for Q1 2025 at -1.8%, suggesting possible contraction
S&P Global projects inflation to remain around 3.0% in 2025 partly due to tariff impacts
Construction employment added 19,000 jobs in February, with average weekly earnings at $1,510 (23% premium over private sector average)

West

Inventory of new houses for sale jumped to highest since December 2007, up by 10% year-over-year
Sales in the West fell by 14% year-over-year and by 25% from February 2019
Supply rose to 10 months, the highest of any region

South

Inventories of new houses for sale at all stages of construction remain at record highs (296,000 houses)
Inventory up by 6% from last year and by 72% from February 2019
Sales were up by 18% year-over-year

Corporate Real Estate Developments

Wingspire Equipment Finance announced plans to relocate headquarters to Flight at Tustin Legacy in October 2025, doubling space to 15,000 square feet
Nimbl Consulting LLC opened a new office in Hyderabad, India as part of strategic growth initiatives

Federal Housing Initiatives

HUD and DHS signed MOU to ensure federal housing funds aren't allocated to undocumented immigrants, enhancing data sharing between agencies
HUD and DOI announced creation of Joint Task Force on Federal Land for Housing to address the nation's 3.8 million housing unit shortage
Enhanced enforcement of Section 214 of the Housing and Development Act of 1980 expected to impact housing program administration

Local Zoning Developments

Coalition of lawmakers and community groups filed lawsuit challenging New York City's 'City of Yes' housing initiative, which aims to create 80,000 housing units over 15 years by easing zoning restrictions

This newsletter is for informational purposes only and should not be considered as financial advice.