The latest economic and policy trends facing mortgage servicers

Join this webinar for an in-depth roundtable discussion on economic and policy trends impacting servicers as well as a look ahead at strategies servicers should employ in the next year.

2021 RealTrends Brokerage Compensation Report

For the study, RealTrends surveyed all the firms on the 2021 RealTrends 500 and Nation’s Best rankings, asking for annual compensation data for the 2020 calendar year.

Zillow analyst on whether home prices can keep climbing

Today’s episode of HousingWire Daily features an interview with Nicole Bachaud, as she discusses annual and monthly home price appreciation growth, rising inventory levels and rent prices.

Lenders, it’s time to consider offering non-QM products

The non-QM market is making a comeback following a pause in 2020. As lenders rush to implement, Angel Oak is helping them adopt these new lending products.

Real Estate

What builders see in a deeply unhealthy housing market

What does this mean for homebuilders?

HW+ houses

The big news from the U.S. Census Bureau’s May new home sales report is that sales inventory has increased to 5.1 months, which brings the three-month average to 4.63 months. That begins to change the equation for some homebuilders, who were absolutely thriving in an ultra-low-inventory housing market environment. 

As a reminder, when the three-month average for inventory is 4.3 months or lower, builders have the confidence to continue to build. When inventory is between 4.4 and 6.4 months, builders need to see sales growth to continue to build. When inventory is 6.5 months or above, builders will exercise caution and even halt new projects.

Housing-Market


Census: For Sale Inventory and Months’ Supply, The seasonally‐adjusted estimate of new houses for sale at the end of May was 330,000. This represents a supply of 5.1 months at the current sales rate.

The headline monthly supply of 5.1 months is what we saw during decent housing market demand in the previous cycle. So although inventory has increased, it is not at a level of concern. Mother Economics is a serial killer who wants to get caught. She leaves plenty of evidence for those who are interested in discovering her next moves. Tracking the data over many years will show you the way. 

The builder’s confidence index tends to correlate with inventory. Historically speaking, the current level of builder confidence is relatively high. The index shows a parabolic move in 2020 from the lows of the COVID-19 crisis, and has since moderated. Because this index tracks confidence, a somewhat subjective measure, it doesn’t make sense to look at the total levels and compare them to other cycles. The direction of the trend is more valuable than any number. For example, the index may approach 70, which is a respectable number, but when we consider that it peaked near 90, the drop tells what the builder is thinking.

This content is exclusively for HW+ members.

Start an HW+ Membership now for less than $1 a day.

Your HW+ Membership includes:

  • Unlimited access to HW+ articles and analysis
  • Exclusive access to the HW+ Slack community and virtual events
  • HousingWire Magazine delivered to your home or office
  • Become a member today

    Already a member? log in

    Most Popular Articles

    These are the hottest housing markets in America

    A housing market report from RE/MAX found that 36 of 51 metro areas had double-digit year over year sale price increases in August. Boise led the way.

    Sep 17, 2021 By

    Latest Articles

    Housing permits hold the key for economic expansion

    Housing permits, for me, is one of the most important housing and economic data lines we have in America. As long as housing permits are moving upward, not only is housing doing ok but the economic expansion is moving along nicely post-1996. HW+ Premium Content.

    Sep 21, 2021 By
    3d rendering of a row of luxury townhouses along a street

    Log In

    Forgot Password?

    Don't have an account? Please