The National Association of Homebuilders (NAHB) has only been publishing builder confidence numbers since the mid 1980s.  It's possible--if not likely--that the late 70s and early 80s would be worse than the present in terms of volatility.  But even if we forget the fact that today's number represents the biggest year-over-year drop on record, the housing market is still obviously in distress. There won't be any ground-breaking insights here, so there's no sense in devoting too many words to a very simple phenomenon.  Home prices rose at an unprecedented pace post-covid and were likely to face resistance regardless of the interest rate outlook. When we add the sharpest rate spike since the 1980's to the mix, it only accelerated the inevitable. One other potentially troubling facet of the current situation is that the 6 month outlook for sales has fallen below the headline confidence levels.  This actually began happening shortly after the pandemic began, but it was never seen before that.  This type of data isn't typically compared, so I'll leave it to you to draw your own conclusions.   On the plus side, this could be as simple as housing market participants believing the brunt of the frenzy had run its course due to excessive home price gains and surprisingly strong sales in 2020 and 2021.  On the downside, it could be builders' way of capitulating to the new reality for interest rates.

October 18, 2022 Download our Mobile App: Download our Mobile App: 30 Yr. Fixed 6.15% -0.02%   6.01% 7.13% 15 Yr. Fixed 5.72% -0.03%   5.55% 6.5% 30 Yr. Jumbo 6.33% -0.02%   6.1% 7.45% Compare Mortgage Rates from Local Lenders for Oct 18, 2022 Mortgage News Daily Rate Change Points 30 Yr. Fixed 6.15% -0.02 0.00 15 Yr. Fixed 5.72% -0.03 0.00 30 Yr. FHA 5.75% -0.05 0.00 30 Yr. Jumbo 6.33% -0.02 0.00 7/6 SOFR ARM 5.56% -0.03 0.00 30 Yr. VA 5.77% -0.04 0.00 Updates Daily - Last Update: 2/6 Freddie Mac Rate Change Points 30 Yr. Fixed 6.11% +0.01 0.00 15 Yr. Fixed 5.50% +0.01 0.00 Updates Weekly - Last Update: 2/5 Mortgage Bankers Assoc. 30 Yr. Fixed 6.24% +0.08 0.55 15 Yr. Fixed 5.64% +0.09 0.61 30 Yr. Jumbo 6.34% -0.05 0.40 Updates Weekly - Last Update: 1/28 UMBS 30YR 5.0 100.05 +0.01   95.71 100.50 UMBS 30YR 5.5 101.49 +0.04   98.11 101.64 10 YR Treasury 4.213 +0.033   3.932 4.608 MBS Price Change UMBS 4.5 98.06 +0.03 UMBS 5.0 100.05 +0.01 UMBS 5.5 101.49 +0.04 GNMA 4.5 97.84 +0.10 GNMA 5.0 100.18 +0.11 GNMA 5.5 101.22 -0.02 Pricing as of: 2/7 11:51AM EST US Treasury Yield Change 2 YR Treasury 3.496 +0.044 5 YR Treasury 3.753 +0.036 7 YR Treasury 3.965 +0.026 10 YR Treasury 4.213 +0.033 30 YR Treasury 4.851 +0.006 Pricing as of: 2/7 11:51AM EST Other News Record Annual Decline in Builder Confidence Tue, Oct 18, 2022 5:23PM The National Association of Homebuilders (NAHB) has only been publishing builder confidence numbers since the mid 1980s.  It's possible--if not likely--that the late 70s and early 80s would be worse than the present in terms of volatility.  But even if we forget the fact that today's number represents the biggest year-over-year drop on record, the ... (read more) Subservicer, Processing, Non-QM, Culture Building Tools; USDA, FHA Changes; Freddie's Cash Flow Product Tue, Oct 18, 2022 9:40AM Do you think putting together a loan is tough? How ‘bout a giant skeleton in your front yard? This dedicated individual has documented the process of his spooky creations on Instructables. This will be super helpful for when you create a giant skeleton of your own next year or pass this along to a new homeowner that recently bought a home with your company’... (read more) Latest Video Digital Risk: Mortgage rates are set at a national level, but real estate i... Homebuilder sentiment drops eight points in October The 2pm Bond Report - October 18, 2022 The 9am Bond Report - October 18, 2022 Around the Web CNBC Homebuilder sentiment drops to half of what it was six months ago Calculated Risk Blog 3rd Look at Local Housing Markets in September, California Sales off 30% YoY Wall Street Journal Home Buyers Flock to Florida Cities Devastated by Hurricane Ian Calculated Risk Blog Some "Good News" for Homebuilders Brookings Inst. 4 key takeaways from the September CPI report Calculated Risk Blog Housing October 17th Weekly Update: Inventory Increased, New High for 2022 Eye on Housing Single-Family Permits Decline in August 2022 CNBC 10-year Treasury yield hovers around 4% as stock markets rally on solid earnings CNBC Bank of America CEO says latest spending and savings data show that the U.S. consumer is healthy Calculated Risk Blog Industrial Production Increased 0.4 Percent in September CNBC The EU wants to limit spiking gas prices after 'excessive' moves this summer CNBC While global central banks take on jumbo hikes, Australia took a smaller step CNBC European markets expected to open higher after UK fiscal U-turns

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