Home-Builder Rally Fueled by Low Interest Rates, Millennials

By Will Parker
The Wall Street Journal
December 24, 2019
Category: Business & Politics
Region: Canada, United States

U.S. home builders benefited from low interest rates this year as housing starts climbed to levels not seen in a decade and new-home sales surged after a disappointing 2018. Builder confidence, as measured by the National Association of Home Builders, is now the highest since 1999. …Home builders cranked up volume partly by focusing on homes more buyers can afford. …Some home builders and analysts question whether growth will continue at the current pace next year. Fitch, for example, predicts new-home sales will only grow 1.5%, compared with 9% in 2019. Interest rates are expected to remain low, meaning mortgage costs will still be cheaper than in 2018, a continued incentive for more buyers to come into the market. And Fannie Mae forecasts that housing-construction starts will increase 10% next year to reach a postrecession high, giving supply a needed boost. (to access the full story a WSJ subscription is required)

Read More