The numbers: Construction of new homes fell slightly in April for the second month in a row, suggesting rising mortgage rates, record house prices and the high cost of building materials are starting to bite. if.
Home starts fell 0.2% to an annual rate of 1.72 million last month. This is how many homes would be built in 2022 if construction were done at the same rate throughout the year as in April.
Economists surveyed by MarketWatch expected homes to start at a rate of 1.75 million after adjusting to the typical seasonal changes in demand.
The number of permits, on the other hand, fell by 3.2% to 1.82 million.
The permits predict how many houses are likely to be built in the coming months assuming a stable economy. They hit a 15-year high at the end of last year, as mortgage rates fell to historic lows, but have since stabilized.
Large image: It has been the same story before and after the onset of the pandemic. There just isn’t enough housing to go there.
Rising mortgage rates and high prices are likely to reduce demand, but many people still want to buy their own home. There is little evidence to suggest that builders can or will drastically increase construction.
Market reaction: The Dow Jones Industrial Average DJIA,
the S&P 500 SPX,
it was to be reduced in Wednesday’s operations.