Builders saw sales decline significantly as buyers were priced out of the market on higher interest rates and ongoing home building and development costs, including building materials, according to NAHB.
As project inquiries declined significantly in Q2 2022 among build-only and design-build professionals, both have lowered their expectations for new committed projects in Q3 2022.
Despite some economic headwinds, kitchen and bath remodeling demand remains strong. Residential kitchen and bath spending is anticipated to grow by 16% to $189 billion in 2022.
Increased interest rates, building material supply chain bottlenecks and elevated construction costs continue to put a damper on the single-family housing market, according to NAHB.
Slowing sales of existing homes, rising mortgage interest rates, and moderating house price appreciation are expected to dampen owners’ investments in home improvements and maintenance over the coming year.
Builder confidence plunged in July as high inflation and increased interest rates stalled the housing market by dramatically slowing sales and buyer traffic.
Some customers are showing a reluctance to go forward with projects due to the higher costs and delays associated with material shortages, as well as higher interest rates, according to NAHB.
After posting four consecutive monthly declines on rising mortgage rates and worsening affordability conditions, new home sales posted a solid gain in May as some buyers rushed into the market in advance of the Federal Reserve’s June interest rate hike.
Sales of newly built, single-family homes in May increased 10.7%, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
