Market Update: Rates Unchanged; NAHB Housing Market Index, Housing Starts and Building Permits, and Existing Home Sales Coming Up This Week |

Abstract

The National Association of Home Builders is releasing its home builder sentiment index this morning. The National Association of Home Builders' housing market sentiment index is based on a survey of home builders' perceptions on current sales activity, sales expectations for the next six months, and buyer foot traffic. In June, home builder sentiment fell to a level of 67 as rising mortgage rates continue to sway the construction outlook. Existing home sales or resales track the sales of previously constructed homes and make up approximately 90% of residential real estate transactions. Existing home sales slipped 3.4% in May, falling to a level of 5.41 million. Though many see this as a sharp negative decline, National Association of REALTORS® Chief Economist Lawrence Yun reminds us that home sales have simply "Returned to the levels seen in 2019 - prior to the pandemic - after two years of gangbuster performance." This decline is helping replenish the dangerously low level of existing home inventory. Unsold inventory sits at a 2.6-month supply at the current sales pace, up from 2.2 months in April and 2.5 months in May 2021." With more homes on the market, home buyers not only have more options, but they also will likely see more price cuts.