Macro Report

**Macro Flash – Housing Market**



The housing market continues to improve, evidenced by a smaller-than-expected decline in Housing Starts, a recovery in Building Permits, and a notable increase in New Home Sales. Additionally, the downtrend in mortgage rates and consecutive weeks of rising mortgage applications indicate increasing buyer interest, giving a positive outlook for the market.


In December, Housing Starts declined -4.3%, a much smaller drop than the anticipated 8.7% decrease, and follows November’s unexpectedly high increase.

Building Permits showed a notable recovery, rising to 1.9% from the previous month’s -2.5%, surpassing the forecasted 0.7% growth. This is a strong signal of future activity, as the permits/starts relationship snapped back into sync.

The January NAHB (Builders) Housing Market Index increased to 44 from 37, exceeding market expectations of a 39 print. Although still under the neutral 50, this marks the second consecutive month of improvement.

Existing Home Sales fell to -1.0% in December, a downturn from November’s 0.8%, and fell short of the expected 0.3%. Conversely, December New Home Sales rebounded significantly, showing an 8.0% growth from the prior month’s -9.0%. This represents an annualized 664k, which is well above the estimated 645k reading.

The MBA 30-Year Mortgage Rate experienced a slight up- tick to 6.78% from 6.75% the previous week. However, since October’s 23-year peak of 7.90%, there has been a clear downward trend in rates. This easing of rates is

reflected in the MBA Mortgage Applications, which rose by 3.7% in the week ending January 19th. This marks the third consecutive week of increasing mortgage demand, building on the previous week’s 10.4% surge, the steepest in a year.


Housing Starts & Building Permits


New Home Sales