May homebuilder survey results published last week. Top themes: 1) Builder metrics quickly deteriorating across the board. 2) Price cuts on standing ‘speculative’ inventory accelerating. 3) Buyer incentives are back. Market commentary to follow…
#Austin builder: “Some parts of town where finished homes are now taking a month to sell versus hours. Market is definitely correcting. Incentives are back and seeing some builders cutting prices on inventory.”
#Baltimore builder: “Customers now mentioning potential reduction in prices and/or increase in incentives.”
#Bend builder: “Market drastically changed in last month. Traffic slowed significantly. Sellers of both new and used homes are dropping prices.”
#Birmingham builder: “Steep decline in sales over past 2 weeks.”
#Boston builder: “Recently started seeing drop off in buyers wanting to get on interest list. A release of 4 new homes this past weekend may be the first one in quite some time that is not fully sold out from buyers on our waiting list.”
#Charlotte builder: “Still not meeting [sales] goal and seeing less traffic, with people taking longer to make decisions. Some close-out communities are not getting traffic.”
#Columbus builder: “May traffic down 25% from April and don’t expect June to compare well to May.”
#Dallas builder: “Lower priced, outlying communities have slowed. Interest lists are nearly half of what they were.”
#Denver builder: “Higher rates are definitely bringing a chill to the market.”
#Greenville builder: “Lowest traffic in many months.”
#Harrisburg builder: “Market is soft, inventory is building. Missed May projected sales by 50%.”
#Houston builder: “Home prices hit a ceiling and incentives are starting to show up.”
#Jacksonville builder: “Released 4 inventory homes in a HOT community and only sold 1 (first time haven’t sold them in under 48 hours in more than a year)."
#LosAngeles builder: “Seeing more cancellations due to payment shock for those in backlog that didn't lock rates.”
#Nashville builder: “Most builders are cutting speculative housing starts by 15%.”
#Philadelphia builder: “Forced to reduce some pricing and become more competitive.”
#Phoenix builder: “As interest rates rise and pricing continues to escalate, there’s no way we can sustain the type of sales rates we are used to.”
#Portland builder: “Incentives are back in the market.”
#RiversideSanBernardino builder: “Pricing in this market will correct by 5-10%. If this administration lets the housing market slide because of inflation, we’ll probably take some more hits to pricing.”
#SaltLakeCity builder: “Had a rough May.”
#SanAntonio builder: “Builders are requiring higher earnest money deposits. Rates are impacting buyers due to debt-to-income ratios.”
#Tampa builder: “Website and phone traffic slowed dramatically in the past 45-60 days. Longer-term pause in buyer traffic would cause alarm for our 2023/2024 business plans.” THE END
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