Housing rebounds; conventions in full swing

This week brought more evidence that the housing market has caught fire – with record low mortgage rates driving a V-shaped recovery despite high unemployment and an elevated mortgage delinquency rate. Housing starts rebounded to nearly 1.5 million annualised in July which, aside from last winter when the figures were distorted by the unseasonably mild weather, was the highest level since 2006. In addition, existing home sales rocketed back up to 5.86 million annualised, erasing all the pandemic-related slump. Since existing home sales are only recorded at the end of the sale process, there are also good reasons to expect that recovery has further to run. New home sales, which are recorded at the initial stage of the transaction, had already hit a 16-year high in June.