Latest news with #BuddyHughes
Axios
2 days ago
- Business
- Axios
The housing market slump is getting worse
A longtime slump in the new housing sector is getting worse, according to new indicators. Why it matters: The broader economy held up during a "rolling recession" that hit the housing industry in recent years. That might not be the case this time if other sectors slow concurrently. Catch up quick: Builders broke ground on home construction in May at the slowest pace in five years. The issuance of building permits, an indicator of the appetite to build homes, also hit a five-year low. Sentiment among homebuilders dropped to the lowest level since 2022 in June. Lennar, one of the nation's biggest homebuilders, reported weaker-than-expected quarterly earnings, citing a soft housing market. State of play: Now the sector faces new Trump-era factors, including tariffs and deportations, that are holding back construction and limiting supply. Plus, in certain parts of the country, there is too much inventory compared to demand. Driving the news: Housing starts fell almost 10% last month to an annualized pace of 1.3 million, well below the rate that economists expected, the Commerce Department said Wednesday morning. Building permits also came in worse than expected, particularly for single-family homes. They dropped to an annualized rate of 898,000, nearly 3% below April. What they're saying: The National Association of Home Builders said sentiment among builders has only been lower than its June level twice since 2012. "Buyers are increasingly moving to the sidelines due to elevated mortgage rates and tariff and economic uncertainty," said Buddy Hughes, a North Carolina-based developer who chairs the NAHB, said in a statement Tuesday. The big picture: Softer demand is being met by higher building costs, including for labor and materials. The industry is heavily reliant on immigrant workers, who are being targeted for deportations by the Trump administration. Meanwhile, tariffs on steel and aluminum have doubled to 50%, except for U.K. imports of the materials. The Trump administration is considering higher tariffs on wood materials, including lumber. "New construction has slowed as builders have pulled back on production," Lennar co-CEO Stuart Miller said on an earnings call Tuesday.
NBC News
3 days ago
- Business
- NBC News
Homebuilder sentiment nears pandemic low as economic uncertainty plagues consumers
Higher mortgage rates and uncertainty in the broader economy continue to weigh on consumers — and consequently on the nation's homebuilders. Builder sentiment in June dropped 2 points from May to 32 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Anything below 50 is considered negative. The index stood at 43 in June 2024. Analysts had been expecting a slight improvement, given recent tariff negotiations and pullbacks by the Trump administration. This index has only seen a lower reading than June's level twice since 2012 — in December 2022, after mortgage rates shot up from record lows during the first two years of the pandemic, and in April 2020 at the very start of the pandemic. Of the index's three components, current sales conditions fell 2 points to 35, sales expectations in the next six months dropped 2 points to 40, and buyer traffic fell 2 points to 21, the lowest reading on that metric since the end of 2023. 'Buyers are increasingly moving to the sidelines due to elevated mortgage rates and tariff and economic uncertainty,' said Buddy Hughes, NAHB chairman and a homebuilder from Lexington, North Carolina, in a release. 'To help address affordability concerns and bring hesitant buyers off the fence, a growing number of builders are moving to cut prices.' In the June survey, 37% of builders said they had cut prices, the highest share since NAHB started tracking the monthly metric three years ago. That is up from 34% who reported cutting prices in May and 29% in April. The average price reduction was 5%, which has been steady since late last year. 'Rising inventory levels and prospective home buyers who are on hold waiting for affordability conditions to improve are resulting in weakening price growth in most markets and generating price declines for resales in a growing number of markets,' said Robert Dietz, chief economist at the NAHB. 'Given current market conditions, NAHB is forecasting a decline in single-family starts for 2025.' The report follows quarterly earnings from Lennar, one of the nation's largest homebuilders, in which the second-quarter average home price dropped nearly 9% from the same quarter in 2024. Guidance on new orders and deliveries was also below analysts' expectations. 'As mortgage interest rates remained higher and consumer confidence continued to weaken, we drove volume with starts while incentivizing sales to enable affordability and help consumers to purchase homes,' said Lennar co-CEO Stuart Miller in an earnings release. Regionally, on a three-month moving average, the South and West showed the weakest builder sentiment. Those are the regions where the most homes are built.
CNBC
3 days ago
- Business
- CNBC
Homebuilder sentiment nears pandemic low as economic uncertainty plagues consumers
Higher mortgage rates and uncertainty in the broader economy continue to weigh on consumers — and consequently on the nation's homebuilders. Builder sentiment in June dropped 2 points from May to 32 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Anything below 50 is considered negative. The index stood at 43 in June 2024. Analysts had been expecting a slight improvement, given recent tariff negotiations and pullbacks by the Trump administration. This index has only seen a lower reading than June's level twice since 2012 – back in December 2022, after mortgage rates shot up from record lows during the first two years of the pandemic, and in April 2020 at the very start of the pandemic. Of the index's three components, current sales conditions fell 2 points to 35, sales expectations in the next six months dropped 2 points to 40, and buyer traffic fell 2 points to 21, the lowest reading on that metric since the end of 2023. "Buyers are increasingly moving to the sidelines due to elevated mortgage rates and tariff and economic uncertainty," said Buddy Hughes, NAHB chairman and a homebuilder from Lexington, North Carolina, in a release. "To help address affordability concerns and bring hesitant buyers off the fence, a growing number of builders are moving to cut prices." In the June survey, 37% of builders said they had cut prices, the highest share since NAHB started tracking the monthly metric three years ago. That is up from 34% who reported cutting prices in May and 29% in April. The average price reduction was 5%, which has been steady since late last year. "Rising inventory levels and prospective home buyers who are on hold waiting for affordability conditions to improve are resulting in weakening price growth in most markets and generating price declines for resales in a growing number of markets," said Robert Dietz, NAHB chief economist. "Given current market conditions, NAHB is forecasting a decline in single-family starts for 2025." The report follow quarterly earnings from Lennar, one of the nation's largest homebuilders, in which second-quarter average home price dropped nearly 9% from the same quarter in 2024. Guidance on new orders and deliveries was also below analysts' expectations. "As mortgage interest rates remained higher and consumer confidence continued to weaken, we drove volume with starts while incentivizing sales to enable affordability and help consumers to purchase homes," said Lennar co-CEO Stuart Miller in an earnings release. Regionally, on a three-month moving average, the South and West showed the weakest builder sentiment. Those are the regions where the most homes are built.
Epoch Times
23-05-2025
- Business
- Epoch Times
1 in 7 US Home Purchase Deals Were Canceled in April: Redfin
Around 56,000 agreements to purchase homes were canceled across the United States last month amid an environment of economic uncertainty and high housing costs, according to real estate brokerage Redfin. The canceled agreements made up one in seven (14.3 percent) of homes that went under contract in April, higher than 2024's 13.5 percent, Redfin said in a May 22 'Redfin agents report that some buyers are getting cold feet due to widespread economic and political uncertainty. Tariffs, layoffs, and federal policy changes are among the factors prompting people to stay put instead of move,' the brokerage said. The downturn in buyer sentiment is happening as the housing inventory is at a five-year high. Despite adequate supply, demand is slowing, 'meaning the buyers who are in the market often have room to negotiate,' Redfin said. 'Some house hunters are backing out during the inspection period because a better house has or might come along.' Meanwhile, both home prices and mortgage rates remain 'stubbornly high,' the company said. Related Stories 5/21/2025 5/21/2025 The average sales Among the 44 major U.S. metropolitan areas analyzed by Redfin, Atlanta ranked first in terms of canceled deals, with one in five pending home sales falling through last month. This was followed by Orlando, Tampa, Riverside, and Miami in Florida. In a May 22 On the plus side, 'the pullback will likely be short-lived with Zillow anticipating 4.12 million home sales in 2025—that's 1.4 percent higher than in 2024,' it said. 'Zillow data confirms a small rebound in the number of homes going under contract in the first two weeks of May. The early May data suggests that perhaps this year's peak home shopping activity may have been delayed.' Housing Affordability According to the National Association of Home Builders (NAHB)/Wells Fargo Cost of Housing Index, a family making $104,200—the nation's median annual income—had to set aside 36 percent of their earnings to meet mortgage payments on a median-priced new home in the first quarter this year, NAHB said in a May 22 'The Cost of Housing Index clearly shows the need for policymakers to take action to address the nation's housing affordability crisis by enacting policies that will allow builders to increase the nation's housing supply,' said NAHB Chairman Buddy Hughes. 'Eliminating burdensome regulations, ending tariffs on Canadian lumber and other building materials, providing funding to promote careers in the skilled trades, and expediting approvals for affordable projects will allow builders to construct more homes.' Meanwhile, there is uncertainty as to how low mortgage rates could fall given the recent downgrade of the United States' credit rating by Moody's. The rating agency The weekly rate on a 30-year fixed-rate mortgage has risen consecutively for the past two weeks and was at 6.86 percent for the week ending May 22, the highest level since around mid-February. In a May 22 'Pent-up housing demand continues to grow, though not realized. Any meaningful decline in mortgage rates will help release this demand.'
Yahoo
15-05-2025
- Business
- Yahoo
US Homebuilder Sentiment Slides to Lowest Level Since 2023
(Bloomberg) -- Confidence among US homebuilders slumped in May to the lowest level since late 2023, as tariffs made it harder to price homes and anxious consumers dragged their feet on purchases. As Coastline Erodes, One California City Considers 'Retreat Now' How a Highway Became San Francisco's Newest Park Power-Hungry Data Centers Are Warming Homes in the Nordics Maryland's Credit Rating Gets Downgraded as Governor Blames Trump NYC Commuters Brace for Chaos as NJ Transit Rail Strike Looms An index of overall market conditions from the National Association of Home Builders and Wells Fargo slipped 6 points to 34 this month. That trailed all estimates in a Bloomberg survey of economists. All three components that make up the index fell, with a measure of expected sales in the next six months sliding to an 18-month low. A gauge of present sales dropped to the lowest since late 2022, while traffic of prospective buyers was the weakest in 1 1/2 years. 'The spring home buying season has gotten off to a slow start as persistent elevated interest rates, policy uncertainty and building material cost factors hurt builder sentiment in May,' NAHB Chairman Buddy Hughes, a builder and developer from Lexington, North Carolina, said in a statement. Builders face a host of challenges that include stubbornly high mortgage rates, faltering consumer confidence and government policy that risk further restraining housing demand. Builder sentiment fell in all four US regions in May. President Donald Trump, who has pledged to remove burdensome regulations, has also imposed tariffs that the NAHB estimates could boost construction costs by $10,900 a home. However, a recent trade agreement with the UK and a reduction in tariffs with China are 'a welcome development,' NAHB Chief Economist Robert Dietz said in a statement. Nearly 80% of builders reported having difficulty pricing homes because of uncertainty around materials costs, Dietz said. In May, 34% of builders reported cutting prices, the largest share since December 2023, NAHB said. The share of builders reporting using sales incentives was unchanged at 61%. Cartoon Network's Last Gasp DeepSeek's 'Tech Madman' Founder Is Threatening US Dominance in AI Race Why Obesity Drugs Are Getting Cheaper — and Also More Expensive As Nuclear Power Makes a Comeback, South Korea Emerges a Winner Trump Has Already Ruined Christmas ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
