WASHINGTON - U.S. homebuilding fell for a second straight month in June and permits dropped to a two-year low, suggesting the housing market continued to struggle despite declining mortgage rates.
Mortgage rates have been decreasing since the Federal Reserve signaled it was pausing its interest rate raising campaign. Borrowing costs could drop further as the U.S. central bank is poised to cut rates this month for the first time in a decade to protect the economy from rising threats from Washington’s trade dispute with Beijing, and slowing global growth.
Data for May was revised slightly down to show homebuilding falling to a pace of 1.265 million units, instead of slipping to a rate of 1.269 million units as previously reported. Economists polled by Reuters had forecast housing starts dipping to a pace of 1.261 million units in June. The housing market hit a soft patch last year and has been a drag on economic growth for five straight quarters. Economists have said housing had no impact on GDP in the second quarter.
The PHLX housing index .HGX fell, underperforming in a broadly weak U.S. stock market. The dollar weakened against a basket of currencies, while U.S. Treasury prices rose.“These prints are in line with our view of a slowing housing market that is likely to continue on a downward trajectory for the rest of this year, but with no significant risks of an immediate slump,” said Igor Cesarec, an economist at Citigroup in New York.
zillow How could any regular working American family own or even rent a house with the incomes we are living own
At least there was a boom in some constricted markets like LA and SF. But now I’m hearing firsthand from developers in California that they’re done building. Too many regulatory processes to wade through.
Whoever could have predicted that giving the highest earning 1% a huge tax break would have had such a catastrophic effect on the middle classes those self same tax cuts were alleged to be helping? realDonaldTrump may be able to point you in the right direction?
You mean a generation of young adults burdened with growing student loans and personal auto loans are not partaking in the housing market? Color me spooked.