Welcome back to The Week in Review.

I hope you had a good one.

The highlight of my week was connecting with other tech, business, and finance writers at a Substack event in Manhattan. At the end of the evening I felt pretty buzzed, partly from the open bar (thanks, Substack), and partly because I met some really smart, creative people. To name drop just two (both former journalists at large institutions): Dominic-Madori Davis writes at the intersection of Black culture, tech, and politics over at The Black Cat. Jeremy Caplan helps people harness the power of AI at Wonder Tools. This is the silver lining in the decline of traditional news media: top-flight journalists are going solo and making interesting things. We are all benefiting from it. Onto The Week in Review…

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News: Two surveys showed it’s still a seller’s market
Views: This market tightness might not last much longer

A New York Federal Reserve Bank survey showed households think home prices will rise 5% over the coming year. They think mortgage rates will be almost 10% (!) in 3 years time. Unsurprisingly, the survey also shows renters now think the chance of them ever owning their home is only 40% (a survey low). Meanwhile, the Fannie Mae Home Purchase Sentiment Index (HPSI) showed that only 20% said it’s a good time to buy a home.

My view is that the current housing squeeze is the result of a swell of aging Boomers gobbling up housing right as their kids, Millennials, are in their prime homebuying years. But the population growth rate is set to fall, and headship and ownership rates are declining. I wrote about it this week in The Future of Homeownership, here ◉. Below is the key chart from that publication—it explains the past, present, and future of ownership, and it suggests the current squeeze might not last.

Read my full analysis, The Future of Homeownership, here ◉
Book a call with me to talk about my analysis, here ◉
Download my housing data release calendar, here ◉.
The NY Fed survey is here ◎, Fannie Mae survey here ◎

News: Initial jobless claims spiked and banks tightened lending standards
Views: The headlines are more alarming than the reality

Initial jobless claims jumped 22k, up to 231k, over the week ended May 4. This was the highest reading since August 2023. Separately, my favorite leading indicator—the Fed’s Senior Loan Officer Lending Standards Survey, SLOOS—showed banks continue to tighten their lending. At a glance, this is all bad news.

But it’s mostly probably fine. The spike in jobless claims was centered almost entirely in the state of New York, and gives back some unusual tightness in prior readings. As for the lending survey, the number of banks tightening doesn’t correlate with the economy, or markets. What actually matters is the change, and the change was minimal. And, as I wrote a couple of weeks ago (here, ◉), other great leading indicators, like housing investment, suggest no risk of imminent recession.

News: A NY Fed study showed mortgage lock-in is a small factor
Views: I agree!

The NY Fed analysis took advantage of the data set I described above (see item 1). They asked people if they’d move if they could take their current mortgage with them. A statistically significant portion would, and the effect—as you’d expect—was more pronounced for those with lower mortgage rates. But the Fed researchers found this was driven by a small portion of households, and that in fact, “mortgage rates are not a primary factor in most respondents’ relocation plans for the next three years”.

That makes sense to me. I am personally currently locked into an apartment in Brooklyn at a 2.9% mortgage rate, but hesitate to draw systemic conclusions from my personal situation. Not least because we are seeing all the purported effects of mortgage lock-in—few movers, little inventory—all over the world, including in countries where most homeowners have already seen their mortgage rates ratchet higher. And as the researchers point out, the trend of people staying in their homes for longer far predates the recent rise in interest rates.

The US mortgage market should look more like Denmark’s, here ◉
Mobility has been declining for a long time, here ◉

Dua Lipa + Kevin Parker team up for an excellent album, Radical Optimism. Dua Lipa’s 2020 song Don’t Start Now (here ◎) was one of the best things in music in our dreadful year of the pandemic. Her latest album, out this week, is partly produced by Kevin Parker, the genius behind Tame Impala (my favorite band). It’s, of course, sensational (here ◎).

Focus mode. Certain members of my household think they are effective multitaskers. They will, for example, interrupt brushing their teeth to water the plants (toothbrush in mouth, foam dribbling down chin). But humans are not parallel processors! Distractions are the enemy of anyone trying to make good things, and the beeps, boops, and oddly sensual vibrations that come from your iPhone are the worst culprit. I am becoming increasingly obsessed with creating a cocoon of concentration around me, and here are the tools I am using (send me yours!):

• Mac iOS focus modes: my “work mode” silences everything but messages from the aforementioned toothbrushing plant waterer.

• Command + option + H: Pressing this key combination closes all windows except the one you have open.

• The Boox Palma: The what? Yeah, there is a company called Boox, and they made a little thing called the Palma (here ◎), which looks like an iPhone, but is in fact just an e-ink reader, like a Kindle, but with continuous scrolling and other features (like RSS readers, which I praised last week, here ◎). I haven’t bought one, but am very tempted.

Ridgeline. There is a guy named Craig Mod who walks around Japan and writes about it. He takes beautiful photos. His newsletter is a masterclass in attention to detail. Even if you are neither into walking nor Japan, this is worth checking out (here, ◎).