US housing market in ‘free fall’ as builder confidence suffers ‘disastrous’ drop: economist

[excalibur]

But only a day or two ago Joe Biden told Americans that the economy was strong.

There are lies, then there are damn lies, and Joe is a damn liar.

The US housing market remains in “free fall” after a survey showed a “disastrous” decline in homebuilder confidence, a prominent economist warned on Tuesday.

Homebuilder confidence plunged for the 10th consecutive month in October, falling to its lowest level since 2012, according to the National Association of Home Builders’ monthly survey. The latest downtick came as mortgage rates spiked to levels not seen since the Great Recession.

The survey’s results were “disastrous” and indicated there is “no bottom yet” for the housing market’s current slump, according to Ian Shepherdson, chief economist at Pantheon Macroeconomics.

“The plunge in the NAHB index makes it clear that the reported jump in new home sales in September was much more noise than signal,” Shepherdson said in a note to clients. “In short, housing is in free fall. So far, most of the hit is in sales volumes, but prices are now falling too, and they have a long way to go.”

Shepherdson added that Pantheon has “no faith at all that mortgage applications have stopped falling” following weeks of declining application volume in response to rising mortgage rates. Ongoing increases in long-term rates will likely cause home sales to fall through early next year “at least,” he added.

...​

US housing market in ‘free fall’ as builder confidence suffers ‘disastrous’ drop: economist

The US housing market remains in “free fall” after a survey showed a “disastrous” decline in homebuilder confidence, a prominent economist warned on Tuesday.

nypost.com

 

[konradv]

But only a day or two ago Joe Biden told Americans that the economy was strong.

There are lies, then there are damn lies, and Joe is a damn liar.

​

The US housing market remains in “free fall” after a survey showed a “disastrous” decline in homebuilder confidence, a prominent economist warned on Tuesday.​

​

Homebuilder confidence plunged for the 10th consecutive month in October, falling to its lowest level since 2012, according to the National Association of Home Builders’ monthly survey. The latest downtick came as mortgage rates spiked to levels not seen since the Great Recession.​

​

The survey’s results were “disastrous” and indicated there is “no bottom yet” for the housing market’s current slump, according to Ian Shepherdson, chief economist at Pantheon Macroeconomics.​

​

“The plunge in the NAHB index makes it clear that the reported jump in new home sales in September was much more noise than signal,” Shepherdson said in a note to clients. “In short, housing is in free fall. So far, most of the hit is in sales volumes, but prices are now falling too, and they have a long way to go.”​

​

Shepherdson added that Pantheon has “no faith at all that mortgage applications have stopped falling” following weeks of declining application volume in response to rising mortgage rates. Ongoing increases in long-term rates will likely cause home sales to fall through early next year “at least,” he added.​

​

...​

US housing market in ‘free fall’ as builder confidence suffers ‘disastrous’ drop: economist

The US housing market remains in “free fall” after a survey showed a “disastrous” decline in homebuilder confidence, a prominent economist warned on Tuesday.

nypost.com

The resale market is strong where I live. I was looking to relocate and attractive places were going quickly, often for over asking price.

 

[g5000]

The housing market has been way overheated for a while now. It is to be expected there would be cooling when the Fed raised interest rates.

The houses where I live are many hundreds of thousands of dollars above what they were during the subprime bubble.

 

[excalibur]

Several of you missed the part where it mentions homebuilders. It isn't referencing existing homes.

 

[Mac1958]

No surprise. The Fed was so late in addressing inflation that it has to put its boot on throat of the economy by increasing them quickly now.

 

[konradv]

Several of you missed the part where it mentions homebuilders. It isn't referencing existing homes.

So? I was referencing resales. Seems you left that out in your analysis of the market. Why do that on incomplete data, except that it didn’t fit the narrative?

 

[Woodznutz]

Several of you missed the part where it mentions homebuilders. It isn't referencing existing homes.

Zackly. This put even more upward pressure on home prices. In my city quality homes don't even hit the market. Realtors have qualified buyers waiting to snatch any that come for sale.

 

[konradv]

Zackly. This put even more upward pressure on home prices. In my city quality homes don't even hit the market. Realtors have qualified buyers waiting to snatch any that come for sale.

With the resale market being that hot, it won’t be long before it’ll make more sense to build.

 

[B. Kidd]

Homebuilder's cannot absorb the rising land and material increases and be expected to drop prices when interest rates hit 7% and higher.

This is the perfect example of stagflation!!

 

[Marener]

Homebuilder's cannot absorb the rising land and material increases and be expected to drop prices when interest rates hit 7% and higher.

This is the perfect example of stagflation!!

Inflation is largely driven by housing prices so if the prices drop then inflation will go down.

 

[marvin martian]

With the resale market being that hot, it won’t be long before it’ll make more sense to build.

Not when a sheet of plywood that cost $40 two years ago costs $80 now.

 

[1srelluc]

Homebuilder's cannot absorb the rising land and material increases and be expected to drop prices when interest rates hit 7% and higher.

This is the perfect example of stagflation!!

Finally, someone gets the thrust of the OP's article.

Builders in my AO are standing pat right now.....Permit applications for new construction are way down.

In fact many of the old timers that are my age are choosing this time to retire having made bank off of the rubes the last few years.

 

[excalibur]

So? I was referencing resales. Seems you left that out in your analysis of the market. Why do that on incomplete data, except that it didn’t fit the narrative?

WTF are you talking about? Can you not read the thread headline? You know, where it says 'builder confidence'?

 

[JoeB131]

Several of you missed the part where it mentions homebuilders. It isn't referencing existing homes.

Here remains the problem- the lack of affordable housing in the country overall.

The problem is that the Fed is going to the old playbook of "Let's squash economic activity to bring down inflation." That might have worked in the 1980's when the workforce was growing, but it doesn't work now that the workforce is shrinking.

 

[DigitalDrifter]

Interest rates now are at their highest in 20 years.
This will cause a dramatic drop in new purchases, and existing home values will plunge. This will also cause a drop in other goods, as people tend to buy new appliances and furnishings when they purchase new homes.
Overall the economy will see a major cooling off.

 

[Resnic]

I haven't seen a home being built within a 15 mile radius of me in years. But there are 5 separate large apartment complexes almost finished now and 2 other areas being excavated for more now.

Seems like there are less homes being built and more apartments going up.

 

[Vastator]

I haven't seen a home being built within a 15 mile radius of me in years. But there are 5 separate large apartment complexes almost finished now and 2 other areas being excavated for more now.

Seems like there are less homes being built and more apartments going up.

Seems to be a trend amongst the younger generation to prefer renting over buying...

 

[initforme]

View attachment 713353
Here remains the problem- the lack of affordable housing in the country overall.

The problem is that the Fed is going to the old playbook of "Let's squash economic activity to bring down inflation." That might have worked in the 1980's when the workforce was growing, but it doesn't work now that the workforce is shrinking.

Where is the workforce shrinking?

 

[Resnic]

Seems to be a trend amongst the younger generation to prefer renting over buying...

Personally I think it's bigger than that.

Like in California they are slowly abolishing single family home zoning. And California is pretty much the testing phase for all new progressive ideas.

What just happened with single-family zoning in California?

Gov. Gavin Newsom signed legislation that allows more than one unit to be built on lots zoned for only one. It sounds technical, but it's a major change in California housing policy. Here's what it means.

www.latimes.com

This was slightly after the world economic forum made it's statement "you'll own nothing and be happy".



Also one of their other mission statements in that video is letting the poor come into other countries. Well we have seen that happening with Bidens open border where like 2 million illegals have been let into the us so far.

So we have fewer single family homes going up and the home building industry is on a down turn, yet apartment building construction is shooting up? I don't think they want us to own homes, all be pushed into small areas, and live our lives forever renting everything.

Look even Apple is a part of the world economic forum.

Apple | World Economic Forum

And what is apple planning on doing? Turning iphones into rentals so you won't ever own it, you'll just rent your iphone.

Apple Wants You to Subscribe to the iPhone

Plus: The creator of the GIF dies at 74, LG debuts new OLED televisions, and more of this week's stories from the Gear desk.

www.wired.com

 

[konradv]

Where is the workforce shrinking?

Anywhere they’re strict about checking papers.