NAHB recently released its 2025 Priced-Out Analysis, highlighting the housing affordability challenge. While previous posts discussed the impacts of rising home prices and interest rates on affordability, this post focuses on the related U.S. housing affordability pyramid. The pyramid reveals that 70% of households (94 million) cannot afford a $400,000 home, while the estimated median…

Mortgage rates dropped significantly at the start of March before stabilizing, with the average 30-year fixed-rate mortgage settling at 6.65%, according to Freddie Mac. This marks a 19-basis-point (bps) decline from February. Meanwhile, the 15-year fixed-rate mortgage fell by 20 bps to 5.83%. The drop in long-term borrowing costs was driven by a 24-bps decline…

Property tax revenue collected by state and local governments reached a new high in 2024 and continued to make up a bulk of tax revenue. Total tax revenue for state and local governments also reached a high after falling in 2023, driven by higher revenue across all sources. In 2024, tax revenue totaled $2.095 trillion,…

Consumer confidence fell for the fourth straight month amid growing concerns about the economic outlook and policy uncertainties, especially potential tariffs. Uncertainties continue to weigh on consumer sentiment as consumer confidence dropped to a 4-year low and expectations for the future economy fell to a 12-year low. The persistent decline in sentiment has raised recession…

A slight decline in mortgage rates and limited existing inventory helped new home sales to edge higher in February even as housing affordability challenges continue to act as a strong headwind on the market. Sales of newly built, single-family homes in February increased 1.8% to a 676,000 seasonally adjusted annual rate from a revised January…

As housing affordability remains a critical challenge across the country, mortgage rates continue to play a central role in shaping homebuying power. Mortgage rates stayed elevated throughout 2023 and early 2024. Recent data, however, shows a modest decline in mortgage rates. Even slight declines can have a significant impact on housing affordability, pricing more households…

According to the U.S. Bureau of Labor Statistics (BLS), people who are neither working nor looking for work are counted as “not in the labor force”. Understanding the size and characteristics of individuals not in the labor force is crucial for a comprehensive assessment of the job market and overall economic health, as it provides…

Higher interest rates and tight financial lending conditions have led to a decline in loans for new home construction. The total volume of acquisition, development, and construction (AD&C) loans outstanding from FDIC-insured institutions fell 1.02% to $490.7 billion, the third straight quarterly decline. The level of 1-4 residential construction loans, which include loans for the…

Existing home sales in February increased to the second highest level since March 2024, according to the National Association of Realtors (NAR). This rebound suggests buyers are slowly entering the market as inventory improves and mortgage rates decline from recent high in January. Despite rates easing, economic uncertainty may continue to constrain buyer activity. While…

In a widely anticipated move, the Federal Reserve remained on pause with respect to rate cuts at the conclusion of its March meeting, maintaining the federal funds rate in the 4.25% to 4.5% range. While the central bank acknowledged that the economy remains solid, it emphasized a data- and policy-dependent approach to future monetary policy…