US Homebuilder Confidence Collapses In October, Future Sales Hope Hits Decade-Lows
It appears delusion and hope can only last so long – even when one’s salary depends on it – as US homebuilder confidence crashed to COVID lockdown lows in November after refusing to see what everyone else was seeing more months.. and what homebuyers were clearly feeling as prices soared along with mortgage rates and devastated affordability for most Americans. Against expectations of a small drop from 38 in October to 36 in October, the headline confidence index tumbled to 33 – the lowest in a decade outside of the nadir of the COVID crisis…
This the 11th straight monthly decline in homebuilder confidence – the longest losing streak since data began in 1985.
“Higher interest rates have significantly weakened demand for new homes as buyer traffic is becoming increasingly scarce,” NAHB Chairman Jerry Konter said in a statement.
All three sentiment components posted declines this month.
A measure of future sales slid 4 points to 31, the lowest in a decade, while indexes of current sales and prospective buyer traffic weakened to the softest levels since April 2020.
Meanwhile, circling back to the first chart above Americans are seeing the worst home buying conditions in a generation, with a majority of consumers not planning on moving in the coming year… which suggests homebuilders will see housing starts collapse in the coming months…
This could be a very serious problem… as even less supply will do nothing to help prices…and crush the hope of the lagged input in CPI’s OER…
Don’t bet on the peak in inflation quite yet.
Wed, 11/16/2022 – 10:14