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Builder Confidence Falls to 42 Builder Confidence fell one point to 42 in July after falling to 43 in June, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). The HMI index charting current sales conditions in July fell one point to 47 and the gauge charting traffic of prospective buyers dropped one point to 27. However, the component measuring sales expectations in the next six months increased one point to 48, an indication that builders believe a rate cut is coming that will help make building more affordable. Regional three-month moving averages dropped in all regions. Any number over 50 indicates that more builders have a positive outlook than a negative one. Building Permits Rise 3.4% Overall building permits increased 3.4% in June to 1.45 million units after falling to 1.39 million units in May. Single-family permits decreased 2.3% to a 934,000 unit rate after falling to 949,000 units in May. Multifamily permits increased 15.6% to an annualized 512,000 pace after falling to 437,000 units in May. Regional permit issuance was mixed. Housing Starts Rise 3.0% Housing starts rose 3.0% in June to a seasonally adjusted annual rate of 1.35 million units and starts for May were revised up. Single-family starts fell 2.2% to a seasonally adjusted annual rate of 980,000 units from an upwardly revised reading in May. Single-family starts were up 16.1% year over year. Inventory was at a relatively low 4.4-months’ supply. The number of single-family homes under construction is down 2.2% from June 2023. Multifamily starts, which include apartment buildings and condos, rose 19.3% to 373,000 annual units after dropping to 295,000 units in May. Multifamily starts are typically very volatile. Regional housing starts were mixed. New Home Sales Fall 0.6% New home sales fell 0.6% in June to a seasonally adjusted annual rate of 617,000 new homes after falling more than 10% to 619,000 new homes in May, according to the National Association of Home Builders. Sales were down 7.4% from June 2023. New home inventories remained elevated at 476,000 new homes, a 9.3 months’ supply at the current sales pace. Higher inventories of existing homes and mortgage rates that continue to hover around 7% have slowed new home sales. Of the new home inventory, 102,000 are completed ready-to-occupy homes, up 50% year over year. This segment represents 21% of total inventory. Higher inventory levels may be limiting growth in new home prices. The median sales price fell slightly, to $413,000 in June after falling to $417,400 in May, essentially flat compared to June 2023. Builders also stepped up their use of incentives to entice buyers, but it appears buyers are sitting on the sidelines, waiting for the next interest rate cut. Regional new home sales were mixed. Sales of new homes are tabulated when contracts are signed and are considered a more timely barometer of the housing market than purchases of previously-owned homes, which are calculated when a contract closes. Existing Home Sales Fall 5.4% Existing home sales fell 5.4% in June to a seasonally adjusted annual rate of 3.89 million new homes after slipping to 4.11 million new homes in May, according to the National Association of Realtors. Sales were down 5.4% from June 2023 after being down 2.8% year over year in May. The median existing home sales price rose 4.1% from June 2023 to $426,900, the second consecutive all-time high and the twelfth consecutive month of year-over-year price gains. The inventory of unsold existing homes rose 3.1% from May, the equivalent of 4.1 months' supply at the current monthly sales pace. Regional existing home sales were mixed. Regional Housing Data  Mortgage Rates Fall to 6.8% 
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