Total housing starts been quite strong in recent monthsAlthough single-family housing starts fell in March and the housing market faces increasingly strong headwinds, analysts expect to see a pullback in housing starts and permits in the coming.
The National Association of Home Builders’ optimism index has fallen for five consecutive months.
“Builders expect home sales and the housing market in general to slow,” said analyst Rose Quint, who said construction and borrowing costs were rising. “Interest rates have hit on both sides. On the builder’s side, it’s on acquisition, development and construction financing. And then on the buyer’s side of course, on mortgages.
The 30-year fixed rate mortgage is on the rise more than 2 percentage points just since January, hitting first-time buyers hard.
“Daunting, crazy – you know, it’s been really tough,” said Stephen Lock, who made an offer on 8 homes in Richmond, Va., this year with his wife. For the last one, they waived the inspection, offered a price well above the ask, and “still weren’t close to the final offer, not even in the running,” Lock said.
Regarding their budget, Lock said “Well, you know it depends on the week, with the interest rates?”
Lock said they had to reduce their maximum price from $350,000 to $320,000 or even less. And they are about to throw in the towel.
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