Housing Market Slump Continues as Starts and Permits Plunge, Locking Out First-Time Buyers
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Housing starts and building permits fell sharply in January, signaling persistent weakness in the housing market as mortgage rates remain high.
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National Association of Home Builders CEO Jim Tobin says the weak housing data does not surprise him, and he expects a "bumpy" housing market in 2023.
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Tobin says high shelter inflation and uncertainty around Fed rate cuts continue to lock first-time homebuyers out of the market.
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Over 900,000 homes are currently under construction, with the high cost of capital disproportionately impacting the multifamily segment.
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Tobin predicts housing supply will increase about 5% this year, but more inventory is needed, especially at the low end, to get first-time buyers back into the market.