Connect with us

International

US enters ‘housing recession’ as mortgage rates and construction costs rise

US enters ‘housing recession’ as mortgage rates and construction costs rise

 


The U.S. housing market has plunged into a full-scale recession as tighter economic policy and soaring spending weigh on homebuilders.

Builder confidence has fallen for eight consecutive months, marking its worst period since the housing market implosed in 2007 amid the Great Recession, data showed Monday.

The National Association of Home Builders/Wells Fargo housing market index fell 6 points to 49 in August, falling below its breakeven point of 50 for the first time since May 2020.

Tighter monetary policy from the Federal Reserve and persistently high construction costs have caused a housing slump, said NAHB chief economist Robert Dietz.

Demand in the once-booming housing market has slowed significantly in recent months, with soaring mortgage rates and high purchase prices excluding many potential buyers.

Mortgage rates soared in response to the Federal Reserve’s decision to raise interest rates to fight inflation. The average 30-year fixed mortgage rate has almost doubled since January.

The affordability crisis has hampered prospects for homebuilders who were already facing unusually high spending on building materials and labor.

Soaring home prices and mortgage rates have hampered affordability. Bloomberg via Getty Images

Continued growth in construction costs and high mortgage rates continue to weaken market sentiment for builders of single-family homes, said NAHB President Jerry Konter, a builder and developer from Savannah, Georgia.

The survey found that more and more consumers are sitting on the sidelines due to the high cost of buying a home, which is a worrying sign for the market, Konter added. August shopper traffic hit its lowest point since April 2014, excluding the COVID-19 pandemic.

The latest findings from the NAHB also indicated that home prices are falling, with 19% of homebuilders responding to the survey saying they have cut prices since July to encourage sales or protect against cancellations. These listings received a median price reduction of 5% from their original listing price.

Dietz acknowledged that market conditions could improve if inflation eases in the coming months.

Homebuilders face high construction and labor costs.Joe DeMaria Housing market conditions should improve as inflation eases.Newsday via Getty Images

However, as signs multiply that the inflation rate is near its peak, long-term interest rates have stabilized, which will provide some stability on the demand side of the market in the coming months. come, Dietz said.

As The Post reported earlier this month, the median cost of an existing single-family home jumped 14.2% year over year to $413,500, according to the National Association of Realtors. The group noted that the affordability of single-family homes fell dramatically during the second quarter.

Last month, Ian Shepherdson, chief economist at Pantheon Macroeconomics, said prices would plunge significantly if demand cratered.

Sources

1/ https://Google.com/

2/ https://nypost.com/2022/08/15/us-falls-into-housing-recession-as-mortgage-rates-building-costs-surge/

The mention sources can contact us to remove/changing this article

What Are The Main Benefits Of Comparing Car Insurance Quotes Online

LOS ANGELES, CA / ACCESSWIRE / June 24, 2020, / Compare-autoinsurance.Org has launched a new blog post that presents the main benefits of comparing multiple car insurance quotes. For more info and free online quotes, please visit https://compare-autoinsurance.Org/the-advantages-of-comparing-prices-with-car-insurance-quotes-online/ The modern society has numerous technological advantages. One important advantage is the speed at which information is sent and received. With the help of the internet, the shopping habits of many persons have drastically changed. The car insurance industry hasn't remained untouched by these changes. On the internet, drivers can compare insurance prices and find out which sellers have the best offers. View photos The advantages of comparing online car insurance quotes are the following: Online quotes can be obtained from anywhere and at any time. Unlike physical insurance agencies, websites don't have a specific schedule and they are available at any time. Drivers that have busy working schedules, can compare quotes from anywhere and at any time, even at midnight. Multiple choices. Almost all insurance providers, no matter if they are well-known brands or just local insurers, have an online presence. Online quotes will allow policyholders the chance to discover multiple insurance companies and check their prices. Drivers are no longer required to get quotes from just a few known insurance companies. Also, local and regional insurers can provide lower insurance rates for the same services. Accurate insurance estimates. Online quotes can only be accurate if the customers provide accurate and real info about their car models and driving history. Lying about past driving incidents can make the price estimates to be lower, but when dealing with an insurance company lying to them is useless. Usually, insurance companies will do research about a potential customer before granting him coverage. Online quotes can be sorted easily. Although drivers are recommended to not choose a policy just based on its price, drivers can easily sort quotes by insurance price. Using brokerage websites will allow drivers to get quotes from multiple insurers, thus making the comparison faster and easier. For additional info, money-saving tips, and free car insurance quotes, visit https://compare-autoinsurance.Org/ Compare-autoinsurance.Org is an online provider of life, home, health, and auto insurance quotes. This website is unique because it does not simply stick to one kind of insurance provider, but brings the clients the best deals from many different online insurance carriers. In this way, clients have access to offers from multiple carriers all in one place: this website. On this site, customers have access to quotes for insurance plans from various agencies, such as local or nationwide agencies, brand names insurance companies, etc. "Online quotes can easily help drivers obtain better car insurance deals. All they have to do is to complete an online form with accurate and real info, then compare prices", said Russell Rabichev, Marketing Director of Internet Marketing Company. CONTACT: Company Name: Internet Marketing CompanyPerson for contact Name: Gurgu CPhone Number: (818) 359-3898Email: [email protected]: https://compare-autoinsurance.Org/ SOURCE: Compare-autoinsurance.Org View source version on accesswire.Com:https://www.Accesswire.Com/595055/What-Are-The-Main-Benefits-Of-Comparing-Car-Insurance-Quotes-Online View photos

ExBUlletin

to request, modification Contact us at Here or [email protected]