Payne Capital Management President Ryan Payne weighed in on the U.S. economy, arguing that Americans’ purchasing power will continue to “strengthen.”
Builder confidence in the U.S. housing market jumped into surprising positive territory this month, jumping to its highest level since July, as more home buyers are attracted to new construction amid a continuing shortage of existing homes.
National Association of Home Builders/Wells Fargo Housing Market Index. Single-family housing marketrose 3 points to 51 in March, marking the fourth consecutive month of increase.
Homes under construction at the Cold Spring Barbera Homes subdivision in Loudonville, New York on November 8, 2023. (Angus Mordaunt/Bloomberg via Getty Images/Getty Images)
A reading below 50 is considered negative. This is the first time since July that the index has exceeded the break-even point. Economists had expected this month’s reading to be flat at 48.
| ticker | safety | last | change | change % |
|---|---|---|---|---|
| Len | Lennar Co., Ltd. | 156.57 | +3.71 | +2.43% |
| DHI | Dr. Horton Co., Ltd. | 151.77 | +0.07 | +0.05% |
| Thor | Toll Brothers Co., Ltd. | 120.31 | +2.11 | +1.79% |
“Buyer demand remains strong, and if mortgage rates continue to fall later this year, more consumers will be brought off the sidelines and into the market,” said Carl Harris, chairman of NAHB, a Wichita, Kan., custom home builder. We expect them to jump in,” he said.
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“However, despite strong demand, builders face several supply-side challenges, including a lack of buildable land, a lack of skilled labor, and new restrictive regulations that continue to drive up the cost of building homes. It continues,” Harris added.
As there continues to be a shortage of existing homes on the market, more people are buying new homes. (Photographer: David Paul Morris/Bloomberg via Getty Images/Getty Images)
Builder sentiment began to decline steadily in late summer last year as mortgage rates rose above 7%, dampening demand from prospective homebuyers. However, many investors federal reserve The aggressive campaign to raise interest rates has ended, and the bank will soon turn to rate cuts.
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Interest rates on popular 30-year fixed mortgages are currently hovering around 6.74%, according to Freddie Mac, down from a high of 7.79% at the end of October but well above the pre-pandemic average of 3.9%. There is.
Workers assemble a home under construction at the Cold Spring Barbera Homes subdivision in Loudonville, New York, on November 8, 2023. (Angus Mordaunt/Bloomberg via Getty Images/Getty Images)
The recent drop in home prices has sparked optimism among home builders that the worst may be over.but housing market As we look ahead to 2024, we are facing new headwinds, including rising prices and shortages of labor and wood.
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“With the Fed expected to announce future rate cuts in the second half of 2024, lower funding costs will attract more potential buyers to the market,” said NAHB Chief Economist Robert Dietz. “However, as homebuilding activity picks up, builders will grapple with rising prices for materials, especially wood.”
FOX Business’ Megan Henney contributed to this report.
