Winter is Here and Housing Market Show Good Indicators Of Susta

Housing Market – According to data published today, during the month of November the construction of new homes continues to decline, but the bottom could be close.

From the revised October figure, homes started at a seasonally adjusted annual rate of 1.43 million, representing a 0.5% decrease, beating consensus expectations for 1.41 million.

Construction of single-family homes was 4.1% lower than in October, this is the third consecutive drop.

Building permits were below expectations. Compared to October, the rate of operating permits suffered a drop of 11.2%. As for single-family home permits, these fell 7.1%, extending a monthly decline that began in March.

Freddie Mac reported that the average interest rate on a 30-year fixed-rate mortgage last week was 6.31%, which despite being below recent highs is still more than double the previous year’s reading. of 3.11%. Because of this, housing construction has slowed, all of this is part of a setback related to the possibility of acquiring homes, as the world of finance continues to grow reports The Wall Street Journal.

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According to the National Association of Home Builders, builder confidence continues to fall. After 12 consecutive months, builder confidence appears to be faltering, the trade group reported.

Robert Dietz, the chief economist for the trade group, said that it’s not all bad news, even though the confidence index suffered another drop, this is the smallest drop for the index in the last 6 months, which could indicate that possibly the end of this cycle is near.

Dietz isn’t the only one who thinks the housing market may be close to bottoming out after higher rates slow the market. National Association of Realtors Chief Economist Lawrence Yun said existing home sales may be nearing an all-time low.

After peaking in mid-November, mortgage rates have eased, and possibly home sales may be close to bottoming out in the current housing cycle, Yun told Barron’s during a home sales data release.

Despite this, housing market recovery could take time. So Dietz, an economist with the National Association of Home Builders, expects housing to remain weak over the next year.

Dietz states: “We forecast a recovery in 2024, given the existing nationwide housing deficit of 1.5 million units and the lower future mortgage rates anticipated with the Fed’s loose monetary policy in 2024.”

On Wednesday the National Association of Realtors will report its existing home sales figures for November. FactSet anticipates the seasonally adjusted annual rate of homes sold to fall to 4.2 million from October’s preliminary 4.43 million. Such a reading would be the lowest monthly figure since May 2020.