US Home Builder Sentiment Rises to 37 as Iran-Driven Inflation Lifts Mortgage Rates
Updated
Updated · Reuters · May 18
US Home Builder Sentiment Rises to 37 as Iran-Driven Inflation Lifts Mortgage Rates
6 articles · Updated · Reuters · May 18
The NAHB/Wells Fargo housing market index rose to 37 in May from 34, beating forecasts for no change, but stayed below 50 for a 25th straight month.
Higher mortgage rates, rising gas prices and economic uncertainty tied to the Iran conflict are damping buyer demand after oil's rebound revived inflation and pushed benchmark Treasury yields to about 15-month highs.
Builders are still leaning on incentives to move homes: 32% cut prices in May, with the average discount widening to 6%, while 61% offered sales incentives.
Underlying gauges improved but remained weak, with current sales at 40, future sales at 45 and prospective buyer traffic at 25; existing-home sales are still near a 4 million annual pace associated with past housing slumps.
Attention now shifts to April housing starts and permits data due Thursday after March showed a jump in single-family construction but a sharp drop in permits, signaling an uneven outlook.
Why are homebuyers accepting high rates while builders and economists still fear a looming recession?
As the US housing market fractures, which regions now offer buyers opportunity versus risk for sellers?
With the Iran war disrupting global supply, how will this affect the cost of building a new American home?