Rising prices for new and existing homes, low inventories of homes for sale, interest rates climbing to heights not seen since before the recession, all combine to dampen the growth trajectory for housing. While housing is still strong compared to a year ago, it will not be able to continue averaging such strong growth rates this year. An average rate of 1.2 million starts represents a strong housing market in this new, post-crisis world.
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September saw another decline in existing home sales. This month was down -3.3% from August and down -4.1% from September 2017. Every month in 2018, except February, has seen a drop from the same month in 2017. High prices for existing and new homes, increasing interest rates, combined with low inventories and reduced consumer interest in moving are all contributed to this downward trend.