Main Topic: Decline in builder sentiment in the homebuilding market due to rising mortgage rates and high construction costs.
Key Points:
1. Builder sentiment dropped 6 points to 50 in August, the first decline in seven months.
2. Rising mortgage rates and high construction costs are impacting builder sentiment.
3. Buyer traffic and sales expectations have also declined, leading to more builders using sales incentives.
New home sales in the US increased by 4.4% in July, outperforming expectations and highlighting the continued demand for new construction due to a shortage of existing affordable homes. Despite rising mortgage rates, buyers are turning to new homes, causing a decline in sales in the resale market. However, as mortgage rates continue to rise, builder sentiment may be negatively impacted and prices may need to be adjusted to attract buyers.
Home prices in the U.S. rose for the fifth consecutive month in June, despite high mortgage rates, with national prices increasing by 0.9% and only down 0.02% from their peak in June 2022, according to the S&P CoreLogic Case-Shiller index. However, there were significant regional differences, with cities on the West Coast experiencing some of the biggest declines. The housing market continues to face challenges due to low inventory and slow new construction.
The number of homes for sale in the US continued to decline in August, down by 9.2% compared to the previous year and 45% below pre-pandemic levels, leading to higher home prices and affordability concerns.
The gauge of US mortgage applications for home purchases fell to a 28-year low last week due to high mortgage rates, making homeownership less affordable and driving housing affordability to its worst point in decades.
The demand for mortgages in the US has dropped to its lowest level since 1996, with both purchase and refinance applications falling due to low housing inventory and elevated mortgage rates.
Builder confidence in the US housing market unexpectedly dropped for the second consecutive month in September, as high mortgage rates dampened consumer demand for new homes.
U.S. homebuilder confidence fell to its lowest level since April in September due to high interest rates, leading to decreased affordability for buyers and a decline in demand for new home construction.
U.S. homebuilding hit a three-year low in August due to a decrease in demand caused by higher mortgage rates, while permits for future construction rose, suggesting support from limited housing inventory.
The U.S. housing market is facing a shortage of homes, which is driving up prices and making it difficult for buyers to find affordable options, and the problem may get worse as builders become less confident and hesitant to construct new homes due to high mortgage rates and construction costs.
New home construction in the U.S. has plummeted to a three-year low due to high mortgage rates, increased labor costs, and the rising price of building homes, leading to a significant decline in both single-family and multifamily starts.
The pace of new construction in the housing market slowed in August due to high mortgage rates and weakening demand, with housing starts falling to the lowest level since 2020, although building permits increased month over month.
US housing starts fell to their lowest level in three years, indicating a slowdown in homebuilding activity due to mortgage rates lingering above 7%.
Sales of previously owned homes in the US fell for the third consecutive month in August, as higher mortgage rates, rising prices, and a lack of available properties have limited homebuyers' options.
U.S. existing home sales fell 0.7% in August due to high mortgage rates and a worsening supply shortage, with prices reaching a record high.
Mortgage applications and housing demand have dropped as a result of increased mortgage rates, which are now at their highest levels in over 20 years, leading to limited inventory and fewer options for buyers.
As the US housing market starts to cool down, homebuyers are being presented with a good opportunity as more homes see price reductions, according to Zillow, with 9.2% of listings having a price cut in the week ending September 16, a higher rate than in 2019.
The housing market is slowing down due to soaring mortgage rates, which could lead to an economic downturn as home construction is curbed and growth prospects falter, according to billionaire investor Bill Gross.
Confidence among builders in the U.S. housing market has fallen for the third consecutive month due to higher mortgage rates, leading to decreased demand for new homes. The National Association of Home Builders/Wells Fargo Housing Market Index dropped to 40, the lowest reading since January 2023, reflecting concerns about buyer traffic and housing affordability.
Homebuilder confidence in the US dropped to its lowest level in 10 months due to high mortgage rates, which have led to lower buyer traffic and decreased housing affordability.
New U.S. home construction rebounds in September, despite high mortgage rates, with housing starts rising 7%, but applications to build and building permits show a decline compared to last year.
US single-family homebuilding rebounded in September due to high demand and an acute housing shortage, but the surge in mortgage rates may slow momentum and delay the overall housing market recovery, as loan applications to purchase homes plummeted to levels last seen in 1995.