The number of new private housing units under construction fell 22.3% from April 2022 to this past month, according to a Wednesday report from the Census Bureau. Starts are now running at a 1.401 million annual rate, adjusted for seasonal variation. On a month-to-month basis, though, starts increased 2.2% in April.For permits to build, which are seen as a proxy for future construction, the seasonally adjusted annual rate of new permits last month was 21.1% below the rate in April 2022.
The rate on the average 30-year fixed-rate mortgage soared from just over 3% at the start of 2022 to over 7% in November. It has since drifted down following the collapse of Silicon Valley Bank to 6.35%. The steep rise in the cost of mortgages has put homebuying out of reach for many and crushed home sales over the past year.
Homebuilder confidence is up from a recent low of 31 in December. It peaked at a 35-year high of 90 in November 2020 after the Fed slashed interest rates and drove mortgage rates to bargain levels.