Single-family housing starts continued to fall in November, with the pace of construction down 32% since February when mortgage rates began to rise. The housing market continues to weaken because stubbornly high construction costs and elevated interest rates are harming housing affordability. And with the count of multifamily units under construction reaching a near 50-year…
High mortgage rates, elevated construction costs running well above the inflation rate, and flagging consumer demand due to deteriorating affordability conditions have dragged builder sentiment down every month in 2022. Builder confidence in the market for newly built single-family homes posted its 12th straight monthly decline in December, dropping two points to 31, according to…
Downshifting its pace of tightening of monetary policy, the Federal Reserve’s monetary policy committee raised the federal funds target rate by 50 basis points, increasing that target to an upper bound of 4.5%. This marked a relatively smaller increase after four previous 75 basis point hikes. The Fed has clearly communicated it will continue to…
Residential construction loan volume reached a post-Great Recession high during the third quarter of 2022, as home building activity and new home sales remained weak. Outstanding builder loan balances are rising as development debt is being held longer as new homes remain in inventory longer. Loan balances will decline in coming quarters as the development…
The count of open, unfilled jobs for the overall economy declined in October, falling from 10.7 million open positions to 10.3 million. This represents a small decrease from a year ago (11.1 million), a sign the labor market is slowing in response to tighter monetary policy. The degree of this slowing will be critical for…
The missing middle construction sector includes development of medium-density housing, including townhouses, duplexes and other small multifamily properties. While townhouse construction has trended higher in recent quarters, the multifamily segment of the missing middle (apartments in 2 to 4 unit properties) has disappointed. For 2021, there were only 12,000 starts of such residences. This is flat from from 2020,…
