While new home sales received a slight bounce in November from moderating mortgage rates, the housing market continues to struggle because of ongoing supply chain disruptions, elevated construction costs and challenging affordability conditions.
NAHB reports that multifamily units under construction is reaching a near 50-year high, and multifamily permit growth is weakening. Single-family housing starts continued to fall in November.
While builder confidence for newly built single-family homes posted declines for 12 straight months, NAHB reports that builders are registering an increase in future sales expectations.
Pending home sales slid for the fifth consecutive month in October, according to the National Association of Realtors. Three of four U.S. regions recorded month-over-month decreases, and all four regions recorded year-over-year declines in transactions.
Elevated interest rates, stubbornly high building material costs and declining affordability conditions that are pushing more buyers to the sidelines continue to drag down builder sentiment.
Spending for home improvements will continue to face headwinds from declining home sales, rising interest rates, and the increasing costs of contractor labor and building materials.
