Housing numbers fell last month amid high interest rates and a shortage of existing stock, according to the U.S. Census Bureau.
The number of privately-owned housing starts in March fell 14.7 percent from February to 1.321 million. There were 1.458 million privately-owned housing units authorized by building permits last month, down 4.3 percent from 1.523 million in February.
Single-family housing starts dropped 12.4 percent to 1.022 million. Single-family completions dropped 10.5 percent to 947,000. There were 973,000 single-family authorizations, down 5.7 percent from February. There were 1.469 million privately-owned housing completions in March, down 13.5 percent from February and 3.9 percent under the March 2023 rate of 1.528 million.
Builder sentiment remains flat as mortgage rates remained near 7 percent over the past month, according to the National Association of Home Builders/ Wells Fargo Housing Market Index.
Builder confidence in the market for new single-family homes was unchanged at 51 this month, ending a four-month stretch of gains but remaining above the breakeven number of 50. The index charting current sales conditions rose one point to 57, and the component measuring traffic of prospective buyers also increased one point to 35. The index measuring sales expectations fell two points to 60.
Twenty-two percent of builders cut home prices this month, down from 24 percent in March and 36 percent in December 2023. The average price reduction remained at 6 percent for the 10th straight month.
“April’s flat reading suggests potential for demand growth is there, but buyers are hesitating until they can better gauge where interest rates are headed,” according to the report. “With the markets now adjusting to rates being somewhat higher due to recent inflation readings, we still anticipate the Federal Reserve will announce future rate cuts later this year, and that mortgage rates will moderate in the second half of 2024.”