This ARTICLE On Housing Starts Decrease In July But Permit Numbers Increase Was PUBLISHED On August 23rd, 2019
Housing Starts Decrease In July 2019 which sent mixed signals to real estate and mortgage industry analysts and experts.
- Data released earlier this week showed that new construction of homes dropped 4% in the month of July
- However, real estate and mortgage experts do not expect this trend to continue due to increased new construction building permit applications by home builders nationwide
- Many were surprised to see that the new construction of homes dropped more than 4.0% in July 2019
- This marks the second-lowest rate for this year
- Many are not concerned due to the builder’s permit application rose than previous months
- This is a positive sign of increased housing starts in the coming months
In this article, we will cover and discuss housing starts decrease in the month of July 2019 and how it affects the housing markets in the near future.
Analyzing Housing Starts Decrease Data
Data from the U.S. Commerce Department suggests housing starts decrease in July from the previous month. Housing starts decrease to an annual rate of 1.191 million in July 2019 from 1.241 the previous month of June. Investors and market experts were expecting an annual rate of 1.25 million housing starts for the month of July.
According to Massimo Ressa, the Chief Executive Officer at Gustan Cho Associates at Loan Cabin Inc., a market industry expert and housing expert, he said the following:
Permits to build additional properties increased 8.4% to a seasonally-adjusted annual pace of 1.336 million from June’s revised rate of 1.232 million. For permits, economists polled by MarketWatch expected a rate of 1.29 million. Multi-dwelling projects of five or more units dropped 17.2% versus a 1.3% increase for single-family homes, which account for most new construction. This was the highest rate of new single-family construction (876,000) since January. Regionally, new construction declined everywhere except for the Western states, where it rose 1.3%. The decline of mortgage rates throughout 2019 has yet to spark any sort of major boom for the home-buying market, though at the margins it may be helping ease affordability constraints for some Americans. Home builders continue to face the same headwinds as they have all year. There are a large number of open construction jobs that need to be filled. Meanwhile, the land is more expensive, and the ongoing tariff disputes between the U.S. and other countries (notably, China) have raised the prices of construction materials. A significant disappointment in July housing starts should be at least somewhat offset by a nicer reading on building permits, suggesting that there’s better news coming for U.S. housing.
Mortgage Rates are at a 36-month low. Par mortgage rates today are at 3.55%.
Housing Market And Mortgage Rates Today
Mortgage rates are at a 3-year low. Home prices are increasing. Both HUD and the FHFA increased FHA and Conforming Loan Limits for the past three years due to increasing home prices. Mortgage rates have been sliding since the beginning of 2019. Today’s mortgage rates are at 3.55% as of today August 23rd, 2019. Low mortgage rates are now making home affordability for home buyers. This holds especially true for first time home buyers. Most homebuyers who closed on their home loans last year in 2018 can get a net tangible benefit today by refinancing.
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