Residential Housing

November 2018

High prices for new and existing homes, low inventories of homes for sale, interest rates climbing to heights not seen since before the recession, have dampened the growth trajectory for housing.  Housing is still strong compared to a year ago but is starting to weaken and those same year-over-year growth rates will be hard to maintain in 2019.  An average rate of 1.2 million starts represents a strong housing market in this new, post-crisis world.

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Implication

Existing home sales increased for the first time since March, up 1.4% from September but still down from October 2017. This downward trend will continue with increasing interest rates and higher prices for existing homes.

Implication

ARM’s stayed above 4.0% through October and are holding as of mid-November. Rates will continue to rise into 2019.

Implication

The 30-year fixed rate continues to stay just under 5.0% but will likely rise higher into the new year. Housing affordability will decline as rates continue to climb.

2018-11-30T21:58:44+00:00