Homebuilders nationwide aren’t feeling so hot on the future

A nationwide index tracking homebuilder confidence dipped to its lowest point in over 2 years

National /
Nov.November 19, 2018 03:45 PM

Is the sun setting on a strong housing market? (Credit: iStock)

Confidence in the housing market among homebuilders has dropped to its lowest point in more than two years, another sign the market is cooling amid rising interest rates and rising prices.

The National Association of Home Builders/Wells Fargo Housing Market Index dropped eight points to 60, considerably more the single point drop expected by economists, according to Bloomberg.

The Federal Reserve has hiked the benchmark borrowing rate quicker this year than was expected, which has sent mortgage rates to recent highs and has slowed mortgage applications.

NAHB chief economist Robert Dietz called on policymakers to consider homebuilder confidence when crafting economic policy.

“Rising mortgage interest rates in recent months coupled with the cumulative run-up in pricing has caused housing demand to stall,” he said. “Given that housing leads the economy, policymakers need to focus more on residential market conditions.”

The Federal Reserve last raised the federal benchmark borrowing rate in September and is expected to raise it again in December, which would be the fourth hike in a year, one more than initially expected.

Shares for homebuilding companies fell and yields on 10-year Treasury bonds dipped following the release of the report. The sub-indexes for measuring current sales and prospective buyer traffic fell by seven and eight points, respectively, to their lowest points since August 2016.

President Trump’s tariffs on foreign goods also dented the market, market pros said, especially those on Canadian lumber and imported steel. [Bloomberg] — Dennis Lynch


Related Articles

arrow_forward_ios
Sculpture artist Robert Hooke’s Sag Harbor home lists for $10M
Sculpture artist Robert Hooke’s Sag Harbor home lists for $10M
Sculpture artist Robert Hooke’s Sag Harbor home lists for $10M
 An industry report says that mortgage lenders and investors are ill-prepared for the growing challenge of climate risk. (iStock)
Mortgage market stakeholders are unprepared for growing climate change threats
Mortgage market stakeholders are unprepared for growing climate change threats
Macklowe Properties CEO Harry Macklowe, CIM Group Co-Founder Richard Ressler and 432 Park Avenue (Getty, CIM)
432 Park Avenue residents sue developers for $250M
432 Park Avenue residents sue developers for $250M
Mortgage availability improves just as rates set to rise
Mortgage availability improves just as rates set to rise
Mortgage availability improves just as rates set to rise
US household real estate values jump by record $1.2T
US household real estate values jump by record $1.2T
US household real estate values jump by record $1.2T
David Bitton, CMO and co-founder of DoorLoop and Ori Tamuz, CEO and co-founder of DoorLoop (Bitton, DoorLoop, Getty)
Startup DoorLoop to take on goliaths in rental management software
Startup DoorLoop to take on goliaths in rental management software
Richard Grossman
Brown Harris Stevens’ NYC president Richard Grossman steps down
Brown Harris Stevens’ NYC president Richard Grossman steps down
The six bedroom Sagaponack house (Out East)
Sagaponack mansion lists for $32M in East End’s supply-constrained market
Sagaponack mansion lists for $32M in East End’s supply-constrained market
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...