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What is the story about?
Housing starts in the US fell in October to the lowest level since the onset of the pandemic as data delayed by last fall’s government shutdown showed builders continued to cut back amid still-high prices and mortgage rates.
New residential construction decreased 4.6% to an annual rate of 1.25 million homes in October, government figures released Friday showed. The median estimate of economists surveyed by Bloomberg saw 1.33 million housing starts.
Also Read: US adds fewer jobs than expected in December, unemployment rate declines
Starts of one-family homes rose 5.4% to an annualized 874,000 pace, though they remained near the lowest levels of the past two years.
The data indicate builders continued to pump the brakes in the fall, trying to cut construction times and find other efficiencies while waiting for customer demand to return. An index of homebuilder sentiment published by the National Association of Home Builders and Wells Fargo remains at a weak reading of 39, with anything below 50 meaning more builders see conditions as poor than good.
That’s despite some improvement in the nation’s affordability crisis. Mortgage rates that were close to 7% in May fell throughout September and October, eventually reaching 6.25% earlier this month, a more than one-year low. And new-home prices fell for most of last year, according to the most recent federal data through August.
“Last quarter, I noted that declining interest rates could signal the start of a market recovery,” Lennar Corp. Chief Executive Officer Stuart Miller said in an earnings call last month. “Unfortunately, that turnaround has not yet materialized.”
Also Read: US Supreme Court verdict on Trump tariffs looms; January make-or-break for Indian exporters
Hoping to get in front of growing concerns over affordability, President Donald Trump in recent days proposed banning institutional investors from purchasing single-family homes, and asked Fannie Mae and Freddie Mac to purchase $200 billion in mortgage bonds to help drive down borrowing rates.
New residential construction decreased 4.6% to an annual rate of 1.25 million homes in October, government figures released Friday showed. The median estimate of economists surveyed by Bloomberg saw 1.33 million housing starts.
Also Read: US adds fewer jobs than expected in December, unemployment rate declines
Starts of one-family homes rose 5.4% to an annualized 874,000 pace, though they remained near the lowest levels of the past two years.
The data indicate builders continued to pump the brakes in the fall, trying to cut construction times and find other efficiencies while waiting for customer demand to return. An index of homebuilder sentiment published by the National Association of Home Builders and Wells Fargo remains at a weak reading of 39, with anything below 50 meaning more builders see conditions as poor than good.
That’s despite some improvement in the nation’s affordability crisis. Mortgage rates that were close to 7% in May fell throughout September and October, eventually reaching 6.25% earlier this month, a more than one-year low. And new-home prices fell for most of last year, according to the most recent federal data through August.
“Last quarter, I noted that declining interest rates could signal the start of a market recovery,” Lennar Corp. Chief Executive Officer Stuart Miller said in an earnings call last month. “Unfortunately, that turnaround has not yet materialized.”
Also Read: US Supreme Court verdict on Trump tariffs looms; January make-or-break for Indian exporters
Hoping to get in front of growing concerns over affordability, President Donald Trump in recent days proposed banning institutional investors from purchasing single-family homes, and asked Fannie Mae and Freddie Mac to purchase $200 billion in mortgage bonds to help drive down borrowing rates.
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