Filtered by Subscriptions: US Housing Use setting US Housing
The sharp fall in single-family starts in February was expected given the surge recorded the previous month, and leaves starts close to where they were towards the end of 2018. But even with house price growth slowing, decent new home sales should help …
26th March 2019
The surge in existing home sales in February is likely to prove short-lived. Concerns over the health of the economy will act to offset the positive impact of lower interest rates, and coupled with tight inventory levels that suggests existing sales will …
22nd March 2019
A decline in mortgage interest rates from the start of 2012 was an important factor behind the rise in house prices in recent years. But we don’t think the upcoming drop in interest rates will have the same impact. Rates are being cut because economic …
19th March 2019
The drop in new home sales in January came from an upwardly revised December figure, so sales haven’t lost too much momentum going into 2019. Looking ahead, a slowing economy argues against a strong rise in activity. But falling interest rates, and a …
14th March 2019
If a large number of the over one million homes being kept vacant as the owner does not wish to sell were to be brought to market, house prices are likely to drop by 5% to 10%. But while slowing house price expectations may persuade some owners to sell, …
13th March 2019
A fall in existing home sales in January, to a three year low, suggests that the housing market slowdown that began in 2018 continued into 2019. Indeed, even after a decline in mortgage interest rates, mortgage applications for home purchase dropped back …
12th March 2019
The good news that single-family starts saw their largest month-on-month gain for 40-years was tempered to some extent by a drop in building permits to an 18-month low, which implies that surge will prove short-lived. Nevertheless, even as the economy …
8th March 2019
The surge in home purchase demand seen in January was reversed in February, even as mortgage interest rates edged back to their lowest level in a year. That dynamic is likely to continue over the next year or so, with further falls in interest rates …
6th March 2019
New home sales increased for the second month in a row in December, to leave sales more-or-less unchanged over the year. A recovery in homebuilder confidence suggests sales have held-up since the start of 2019. Beyond that, even as a slowing economy …
5th March 2019
The homeowner vacancy rate dropped to a 25-year low at the end of last year, and we expect it will stay low even as existing home sales tread water over the next couple of years. Low interest rates will persuade more investors to keep hold of their …
1st March 2019
The recovery in homebuilder confidence, even as existing home sales have hit three-year lows, reflects the relatively bright outlook for new home sales. While overall housing demand will ease due to a slowing economy, the shortage of existing homes for …
27th February 2019
Annual house price growth has continued to slow, and is likely to reach 2% by the end of the year. But that shouldn’t prevent a modest recovery in single-family housing starts, which ended 2018 at a four-month low. Despite a slowing economy, a lack of …
26th February 2019
A pick-up in home purchase mortgage applications at the start of the year suggests the 1.2% m/m drop in existing home sales in January will soon be reversed. But the bigger picture is that a slowing economy, as well as the continued problem of a lack of …
21st February 2019
High levels of home equity and falling mortgage interest rates mean the number of cash-out refinances will reach a 10-year high over the next couple of years. But tight credit standards and cautious consumers will prevent an unsustainable boom in the …
20th February 2019
Tax returns processed so far indicate households are set for smaller refunds this year. For most, the drop in expected income will not be enough to derail plans to buy a home. But, to the extent refunds are used to bolster down payments, leverage effects …
14th February 2019
The participation rate for younger Americans had risen to a 10-year high by the end of 2018, with women driving most of that gain. That will have supported both rental and home purchase demand. But, with the unemployment rate set to rise as the economy …
12th February 2019
Mortgage applications for home purchase briefly touched a nine-year high in the middle of January, as a drop in mortgage interest rates tempted home buyers back into the market. However, even as interest rates have continued to decline, that jump in …
7th February 2019
A drop in mortgage interest rates to a nine-month low in January helped boost mortgage demand. But the jump in applications for home purchase is already unwinding. Given a slowing economy and lack of homes for sale, housing demand is likely to tread water …
6th February 2019
The reduction in MBS held on the Fed’s balance sheet is, for now, set to continue in 2019. But while the announcement of MBS purchases in late 2008 led to a sharp drop in mortgage rates, we don’t think its reversal will boost rates today. A gradual …
1st February 2019
New home sales surged 16.9% m/m in November, but activity is likely to level off in 2019. While mortgage rates are set to drop back, a slowing economy will weigh on buyer sentiment, and that will keep any growth in sales to a minimum. … New Home Sales …
31st January 2019
House prices are on track to grow by 5% in 2018, down marginally from a rise of 6.3% in 2017. That gradual easing in price growth will continue, as housing demand flat lines on the back of a slowing economy. We expect a rise of around 2% this year, which …
29th January 2019
Households struggling to pay their mortgage thanks to the government shutdown will be offered forbearance. That won’t prevent a rise in the mortgage delinquency rate, but with back pay guaranteed it will keep any rise in foreclosures to a minimum. … …
25th January 2019
Annual house price growth was unchanged at 5.8% in November, but it is likely to resume its downward trend in 2019. While mortgage interest rates are set to fall back, a slowing economy will weigh on housing demand, and house price growth will slow to …
23rd January 2019
Strong mortgage demand over the past couple of weeks indicates that the sharp fall in existing home sales in December will soon be reversed. But a slowing economy, weakening house price expectations and lack of inventory all suggest home sales will …
22nd January 2019
The acceleration in earnings growth to close to a 10-year high in December will not boost rental growth. While stronger earnings will support rental demand, the large number of new apartments being completed means vacancy rates will not fall. In any …
17th January 2019
Our forecast for a rise in house prices of 2% in 2019 is close to the bottom of consensus. That view is supported by evidence that housing market conditions have loosened, and that the size of mortgage applications for home purchase have started to …
15th January 2019
Our forecast for a steady decline in mortgage rates over 2019, to 4.3% by the end of the year, is significantly below consensus. But, despite that, we have below-consensus calls for home sales and house price growth. A slowing economy will hit homebuyer …
10th January 2019
Mortgage interest rates saw further declines in December, and look set to drop back to 4.5% over the next few weeks. However, a spike in mortgage applications for home purchase in the first half of December was quickly reversed. That demonstrates lower …
8th January 2019
The drop in mortgage applications in December, even as interest rates saw further falls, supports our view that lower financing costs will not be enough to boost housing market activity in 2019. A slowing economy and moderation in house price expectations …
3rd January 2019
If it continues, the partial Federal shutdown is likely to lead to a decline in the mortgage closing rate. But lenders showed flexibility to get around the virtual closure of the FHA and IRS during the 2013 shutdown, and we expect they will do the same …
21st December 2018
The drop in 10-year Treasury yields seen in recent weeks has led to lower mortgage interest rates. We now think the 5.17% the 30-year fixed rate reached in November represents the peak of the current cycle. Rates are likely to drop back to 4.3% by …
Existing home sales rose for the second consecutive month in November, and a recovery in mortgage demand over the past month suggests they will see further gains over the turn of the year. But with house price expectations easing, the economy set to slow …
19th December 2018
Single-family housing starts dropped to an 18-month low in November, but we expect a modest rise in starts over the next couple of years. Builders have scaled back production in response to slowing new home demand. But the rise in mortgage applications …
18th December 2018
We expect home sales will end 2020 only slightly higher than they are today. Admittedly, the drop in mortgage interest rates seen over the past few weeks has given a boost to mortgage applications. And rates are set to fall further in 2019. But that won’t …
12th December 2018
A drop in mortgage interest rates in November led to a welcome boost in mortgage demand, which has risen to a five-month high. That should provide some support to home sales over the next month or two. New home sales dropped to a 2½-year low in October, …
10th December 2018
On past form the jump in the months’ supply of new homes to an eight-year high would be consistent with outright falls in national house prices. However, the existing home inventory is not far off record lows. Without large numbers of existing homeowners …
6th December 2018
The drop in the 10-year Treasury yield over the past month has brought down mortgage interest rates. In turn, mortgage applications for home purchase have risen to close to a five-month high. Mortgage rates are likely to fall below 5% over the next couple …
5th December 2018
Home sales are set to tread water over the next couple of years, which is good news for the rental sector. If Americans aren’t buying homes, many will look to rent one instead. Admittedly, the upcoming economic slowdown will weigh on household formation. …
3rd December 2018
Even after a significant upward revision to September’s estimate, the 8.9% m/m drop in new home sales in October was enough to send sales to a 2½-year low. But a drop in mortgage interest rates over the past couple of weeks, and a corresponding jump in …
28th November 2018
With higher mortgage interest rates weighing on housing demand, it is not a surprise that the FHFA and Case-Shiller reported slower annual house price growth in September. We doubt mortgage rates have much further to rise but, with the economy set to slow …
27th November 2018
The first rise in existing home sales for six months in October provided a rare piece of good housing market news. That doesn’t signal the end of the slowdown, but it does indicate that the strong labour market is supporting housing demand, and that a …
21st November 2018
Single-family housing starts dropped for the second month in a row in October, and building permits saw their first annual decline in 4½ years. Faltering new home demand has hit homebuilder confidence. But housing demand is not collapsing and, with …
20th November 2018
Amazon’s decision to base its new, secondary HQs in New York City and Northern Virginia does not mean that rental markets in these cities will enjoy the kind of surge seen in Seattle. At the margins, however, even a modest boost to demand from Amazon’s …
15th November 2018
Amongst all the housing market gloom it is easy to overlook the fact that homes are selling quickly, prospective buyer traffic volumes are high and mortgage lenders are approving a high share of mortgage applications. None of that means that home sales …
13th November 2018
Unlike some, we do not think that the latest rise in homeownership among the under 35s heralds an imminent revival in housing market activity. In fact, it tells us more about the previous strength of the market than current or future conditions. Indeed, …
9th November 2018
The 30-year mortgage rate rose above 5% for the first time in over seven years in October, helping to explain why home purchase mortgage demand fell to a two-year low in October. If we are right in thinking that mortgage rates will peak in the next few …
7th November 2018
New and existing home sales fell again in September, as higher mortgage interest rates weighed on demand. But those homes that are selling are doing so quickly, and the strong labour market argues against a severe crash in activity. Indeed, measures of …
6th November 2018
Rising interest rates, declining house price expectations and cuts to the tax advantages of owning a home have all weighed on housing demand since the turn of the year. Of these, the drop in house price expectations appears to be the main driver, followed …
1st November 2018
After rising for eight consecutive quarters, the homeownership rate was unchanged in the third quarter. A lack of homes for sale, and higher interest rates weighing on home demand, help explain why the recovery in homeownership has stalled. But household …
30th October 2018
The apparent rebound in house price pressures, implied by the 0.6% m/m rise in August, reflects issues with the seasonal-adjustment process, rather than a sign that the slowdown in house price growth has come to an end. With higher interest rates weighing …
