Upton Sinclair once noted: “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”
But at some point, as Mike Tyson opined “someone punches you in the face.”
And it appears from the latest NAHB Sentiment Index that home builders in America just got ‘punched in the face’.
For the second month in a row, home builder optimism crashed amid broad-based declines across sales, expectations and buyer traffic (down 4 to 56 and well below the 60 print expected) as hope begins to collapse back to the housing market’s reality…
Additionally, as Bloomberg notes, a gauge of the NAHB six-month sales outlook dropped to the lowest since March 2016 while a measure of current sales for single-family homes decreased to a three-year low. That suggests demand will remain soft as there’s still a shortage of affordably-priced listings, in addition to property values that have been outpacing wage gains.
Three of four geographic regions showed a decline, led by the Northeast, where sentiment plunged by the most since June 2010.
“We are hearing from builders that consumer demand exists, but that customers are hesitating to make a purchase because of rising home costs,” NAHB Chairman Randy Noel, a custom-home builder from Louisiana, said in a statement.
“However, recent declines in mortgage interest rates should help move the market forward in early 2019.”
All eyes on Powell once again.