Builder Confidence Falls as Home Prices Recede
Home builders predict that prices could fall another 20% in popular markets as a housing […]
Home builders predict that prices could fall another 20% in popular markets as a housing recession moves full speed ahead.
Home builder confidence plummeted for the 10th consecutive month in October as rising mortgage rates continued to chip away at existing homebuyer demand. Builder confidence in the new-home market fell 8 points to 38, the lowest level since 2012, excluding the historic drop at the start of the pandemic in 2020, and while buyer traffic recedes to its lowest level in a decade, economists warn that home prices could fall another 20% by early next year. Insider reports.
The median home price is already down to $436,800 from a record $466,300 this summer, and slower home sales could send prices 15% to 20% lower over the coming months, though markets that were booming throughout the pandemic could see even more disproportionate losses in the near future.
“While some analysts have suggested that the housing market is now more balanced, the truth is that the homeownership rate will decline in the quarters ahead as higher interest rates and ongoing elevated construction costs continue to price out a large number of prospective buyers,” says NAHB chief economist Robert Dietz.
