With the Federal Reserve beginning an easing of monetary policy and builder sentiment improving, single-family starts posted a modest gain in September while multifamily construction continued to weaken because of tight financing and an ongoing rise in completed apartments.
Builder sentiment for new single-family homes increased in October, despite ongoing affordability challenges. The National Association of Home Builders reports optimism for 2025 market conditions, with builders anticipating easing inflation and moderating mortgage rates. The upcoming election remains a key factor in housing policy outlook.
High interest rates for construction and development loans as well as ongoing challenges regarding labor shortages and higher prices for many building materials continued to slow the building market this summer.
Existing-home sales fell in June as the median sales price climbed to the highest price ever recorded for the second consecutive month, according to the National Association of Realtors. All four major U.S. regions posted sales declines.
Persistently high mortgage rates are keeping many prospective buyers on the sidelines, and home builders are also dealing with higher rates for construction and development loans, chronic labor shortages and a dearth of buildable lots.
While single-family construction expanded in the first quarter despite higher mortgage rates, multifamily construction for 2024 is experiencing a notable slowdown primarily because financing conditions.
Confidence in the market for new multifamily housing declined year-over-year in the first quarter of 2024, according to results from the Multifamily Market Survey (MMS) released by the National Association of Home Builders (NAHB).
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