Home builder survey results are in for full month of December. Top themes: 1) Still a ton of demand for new homes. 2) Rampant construction material & labor shortages. 3) Bit of chatter on possible margin compression several quarters ahead. Market commentary to follow…
#Atlanta builder: “Have virtually no available inventory & huge backlog of 1,000+ units going in to 2022. Still metering sales in most communities, where the demand of waiting buyers still outnumbers our supply.”
#LasVegas builder: “Busiest orders for December I can remember in a long time.”
#Charlotte builder: “Haven’t seen this hot of a new homebuilding market in 27 years in Charlotte. Reminds me of the go-go days in the late 1980's right before the S & L's (Savings & Loan Crisis) rocked my new homebuilding world in Southern California.”
#Oakland builder: “Still selling out of every phase as soon as we release homes for sale.”
#SanDiego builder: “There hasn’t been an elevating cost environment like this for ~40 years. Anyone who says otherwise is delusional. If home price increases were less it would be brutal.”
#SanAntonio builder: “Framers are accepting jobs & then demanding more money to actually do the job or they walk. Concrete delivery causing delays in scheduling pours due to lack of drivers. COVID seems to be causing short term labor issues throughout our contractor base.”
#Jacksonville builder: “Costs are through the roof!”
#Orlando builder: “Shortage of materials & labor in almost every trade. No negotiation on bids.”
#Tampa builder: “Debt-to-income ratios are getting out of line for even the above average family to afford new construction. Trade base is stressed beyond max. Quality of construction is what keeps me up at night.”
#Sarasota builder: “Continue to see lumber price increases, appliances on backorder, & HVAC units/systems delayed.”
#Chicago builder: “Garage doors have tripled in cost & lead time is 24 weeks.”
#Stockton builder: “All trades are looking to pass along wage increases. Most product manufacturers are announcing material increases of 5-10% in the new year.”
#WashingtonDC builder: “We’re at the point where we can no longer offset cost increases with price increases.”
#Boston builder: “With a 1-year backlog, we’ve proceeded cautiously to allow time between releases for price increase purposes.”
#Bend builder: “Don't list homes until nearly complete due to volatile materials market & availability. Production has slowed immensely due to lack of hardware (garage doors or cabinet doors, paint, lumber, appliances, HVAC items).”
#RiversideSanBernardino builder: “National builders are buying & warehousing supplies, which strains available product. Everything is on a boat in harbor with no estimate of timing. GE representatives are getting harder to get a hold of. Garage door costs have roughly doubled.”
#RaleighDurham builder: “Expect YOY cost increases to be the same in 2022 that we saw in 2021.”
#Wilmington builder: “Supply chain is still disruptive, delaying offering homes for sale.”
#Knoxville builder: “Costs were already spiraling, then most subcontractors & vendors raised them again effective 1/1/22. No cost pressure relief in sight.”
#Tucson builder: “Windows are being significantly delayed. Brick pavers are hard to find.”
#Austin builder: “Lumber is expected to go back up significantly this year. Being told factories are still not operating at capacity & tariffs aren't allowing solid competition to provide relief.”
#FortWorth builder: “Lumber pricing ready to skyrocket in January. Looking like a repeat of 2021.”
#Houston builder: “Build cycle time increases in all areas (engineering, entitlements, development, permitting, home construction, inspections, etc.) will likely have impacts in early 2022 until supply chain & labor availability stabilizes.”
#Dallas builder: “Consistent cost increases as well as supply issues creating a challenge getting our backlog built & causing margin erosion. Expecting lumber to hit above 2021 pricing.”
#ColoradoSprings builder: “Costs are still rising & ability to pass along increases to buyers is likely going away. Expect gross margins to decrease in the 2nd half of 2022 & in 2023.”
#Phoenix builder: “Margin pressure is getting difficult.” THE END

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More from @RickPalaciosJr

12 Jan
A few gems from today's Fed Beige Book on crazy tight job market. Employers pulling out all the stops, even "no-meeting Wednesdays" to attract people. Image
"Extreme new-worker turnover" Image
"literally begging for employees" Image
Read 4 tweets
13 Dec 21
We’ve been asking building product dealers about supply bottlenecks for several months. Seems like status quo holding for now (not getting better, but also not getting worse). Labor & logistics remain the biggest concerns, see survey commentary to follow…
“All beam products, glass faced gypsum products, windows, & interior trim products continue to tighten.”
“Lumber & engineered wood supply appears to be improving but steel supply remains a concern.”
Read 12 tweets
2 Dec 21
Some interesting comments from today's Fed Beige Book on both housing (investors, lot shortages, market normalizing) & labor market tightness (namely continued wage spike).
#Atlanta Fed housing commentary on investors
#Atlanta Fed commentary on tight job market
Read 14 tweets
29 Nov 21
Monthly pulse of resale housing market still rapid according to 4,500 agents we just surveyed. Top 3 themes: 1) Bit of market normalizing. 2) Skittish sellers fearing nowhere to move. 3) End of travel ban boosting international buyers. Commentary across the country to follow…
#Houston resale agent: “A lot of people are not listing because they don't know where they are going next. Seems that many people listed too high even for a sellers' market, so I am seeing more price reductions now than earlier in the year.”
#Orlando resale agent: “Our buyer pool is increasing. We see more buyers from the north connecting with us as they plan to visit the area from the fourth quarter to the first quarter of next year.”
Read 25 tweets
16 Nov 21
Over the last few months I’ve spoken with dozens of real estate & mortgage industry executives, trying to gauge what impact (if any) #crypto is having on the #housing market. Here’s what I’ve concluded. (1/) realestateconsulting.com/bubblicious-cr…
The number of home buyers w/documented crypto accounts has risen from ~0% one year ago to between 5% & 10% today. Platforms such as @coinbase $COIN were noted most often in my conversations, with $BTC & $ETH common plays. (2/)
It's more difficult tracking the % of home buyers using crypto gains towards the down payment on a home purchase. Most mortgage lenders & home builders estimate ~5% or less. However...(3/)
Read 12 tweets
10 Nov 21
Home prices still accelerating through October in majority of housing markets we track. Handful below finally moderating (#Austin, #Boise, #Phoenix, #Seattle, & #DC). Here's #Austin.
#Boise home prices
#Phoenix home prices
Read 5 tweets

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