Home Builders Slow As Developers Start Fewer Apartment

A report by commerce deep apartment stated that the adjusted rate for new house is 1.25 million, which is a Decline 2.6% in January. The United States saw a drop in apartment constructions, which lead to fewer homes being built last month.  December of 2016 new house construction rose 1.9% while new apartment construction dropped nearly 8%.
However, in the past year new home construction rose 10.5%. This is due to an increase in demand in homes. Despite rising interest rates, the market is still standing strong.

The frustrating obstacle for buyers today is the lack of inventory. The December stock of available homes reached its lowest point since 1999, in turn, prices have elevated so much that buyers have to relentlessly bid against one another.

Homebuilders are seeing the demand firsthand, but can't erect homes fast enough to alleviate a little of the shortage.
On the other hand, future building permits rose 4.6% last month!

A significant rise in permits is good news for these frustrated buyers. Permits turn into starts, and starts develop into new homes for sale. Economists are expecting a significant amount of starts for mid-2017.

A combination of shortage of homes, rising prices, and increasing mortgage rates all aided to hinder the sales of existing homes in December. These homes fell 2.8% from the prior month.

Enough of all the doom and gloom, the good news is that we have officially recovered from the big recession almost a decade ago. Last year builders began work of the most homes since 2007 right before the recession happened.

The Northeast and the south saw the most starts in the month of January. The Northeast had nearly record gains of starts at 55.4%, and the South sought 20% gains.

We will see how higher mortgage rates will affect the market, even though they are still historically low numbers. Lately, the rate has been about 4.15%, which is still higher than any week in all of 2016. One of the main reasons the rates have been increasing is because they've follow the yield on the 10 year Treasury note. And the yield on the Treasury note has been rising because investors anticipated more economic growth since the election.

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