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Existing Home Sales (Nov.)

Existing home sales continued to climb higher in November, leaving sales just short of their peak last year. But we expect a tight inventory and stretched affordability as mortgage rates rise to weigh on sales over the next six months, causing them to fall back to around 5.80m by mid-2022.
Sam Hall Assistant Property Economist
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More from US Housing

US Housing Market Focus

Looser mortgage standards won’t keep the party going

In contrast to the mid-2000s, there seems little chance of a significant loosening in mortgage lending standards in response to higher interest rates today. Traditional banks have not forgotten the financial crisis and, after a 37% rise in house prices in just two years, they are understandably being cautious. Non-banks have a larger incentive to compete standards lower, but with the private label securitisation market still small they are limited to selling to the Government Sponsored Enterprises, who have strict eligibility standards. Accordingly, the surge in mortgage rates will not be offset by an easing in lending standards, and that means housing market activity has further to fall. Real Estate Drop-In (6th July, 2022): Join our US Commercial Property team for this 20-minute briefing on why we think this is the market top – and how far we expect returns to fall. Register now.

1 July 2022

US Housing Market Data Response

Case-Shiller/FHFA House Prices (Apr.)

House price growth is finally showing signs of slowing, in line with measures of housing market activity which peaked at the start of the year. Soaring mortgage rates are shutting some buyers out of the market and forcing others to cut their budgets. While a tight market argues against a house price crash, a small fall to around -5% y/y by mid-2023 now looks likely.

28 June 2022

US Housing Market Update

The anatomy of a housing market downturn

Measures of housing market activity and prices tend to follow a predictable sequence in downturns. In this Update we highlight the key US and UK variables that clients should follow to track the housing downturn and identify turning points. With most indicators already softening in both countries, it is just a matter of time before house prices fall. In view of the wider interest, we are also sending this US Housing Update to clients of our UK Housing Service.

24 June 2022

More from Sam Hall

US Housing Market Data Response

Housing Starts (Nov.)

Single-family housing starts rebounded in November, following a weak four months. While strong new home demand, limited inventory and surging house prices will incentivise builders to increase construction, the recent surge in lumber prices will add to the supply-side challenges weighing on starts.

16 December 2021

US Commercial Property Data Response

Commercial Property Lending (Nov.)

Commercial real estate debt recorded its largest gain in November since the onset of the pandemic. And with investment volumes on track for a record-breaking year, we expect lending activity to remain elevated in the coming months.

13 December 2021

US Commercial Property Data Response

US Metro Employment (Oct.)

The easing of the Delta wave of infections in the South boosted leisure & hospitality hiring in October. Meanwhile, office-based jobs rose in all 30 metros, following widespread declines in September. That left office-based employment above its pre-COVID level in 17 metros.

2 December 2021
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