Homebuilder sentiment rises to a 10-month high

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1. FHFA seeks input on single-family upfront fees

The Federal Housing Finance Agency (FHFA) has issued a request for public input on the single-family pricing framework of GSEs Fannie Mae and Freddie Mac.

The agency is seeking feedback on the goals and policy priorities it should pursue in its oversight of the pricing framework. It’s also seeking input on the GSEs’ single-family upfront guarantee fees and whether it is appropriate to continue linking those fees to the Enterprise Regulatory Capital Framework (ERCF).

Anyone interested may provide written input, feedback, and information on all aspects of the new RFI by Aug. 14. Comments may be submitted via FHFA’s website or mailed to the FHFA.

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2. Homebuilder sentiment rises to a 10-month high

US homebuilder sentiment surged to a 10-month high in May, according to the National Association of Home Builders/Wells Fargo gauge, which rose five points to 50, marking its fifth consecutive monthly increase.

“Lack of existing inventory continues to drive buyers to new construction,” Robert Dietz, NAHB chief economist, said in a statement. “With limited available housing inventory, new construction will continue to be a significant part of prospective buyers’ search in the quarters ahead.”

Indicators of current sales and sales expectations also rose to their highest level since last summer, with prospective buyer traffic at a 10-month high.

The share of builders reducing home prices declined, as did the percentage of firms using incentives to attract buyers, suggesting demand has recovered. This resurgence is partly due to easing mortgage rates which are enticing more potential buyers back into the market.

3. Bad time to buy a house, say a lot of people

A record share of Americans believe it's a bad time to buy a house, according to a Gallup survey released on Tuesday. The percentage hasn't been this high since Gallup started asking the question in 1978.

This sentiment is influenced by a dramatic rise in home prices, soaring mortgage rates, and a scarcity of available inventory as homeowners are reluctant to sell due to their low legacy mortgage rates.

Until 2022, a majority of Americans thought it was a good time to buy a house. However, this view has dropped significantly, with only 21% of Americans considering it a good time to buy in 2023, down from 30% in 2022. In 2021, that number was at 53%. Despite this, real estate remains the top pick for the best long-term investment, reflecting continued faith in property value growth.

4. More Nuggets

🏘️ American suburbs, once marked by dying malls and empty office parks, are thriving. (Axios)

💥 The mortgage refinancing boom and bust. (MarketWatch)

👩‍⚖️ Maxwell acquires mortgage solutions provider LenderSelect. (Axios)

5. Eleventh month of US rent growth slowdown

For the 11th consecutive month, rent growth has slowed across the country, according to a new report from Redfin.

The slowdown in rent growth was particularly pronounced in the Sun Belt, where 8 of the 10 metros with the largest declines are. The biggest declines were in Austin, TX (-14.3%), Phoenix, AZ (-9.6%), and Las Vegas, NV (-7.1%).

On the other hand, rents in the Midwest continued to rise. The biggest increases were in Providence, RI (16%), Raleigh, NC (12.4%), and Indianapolis, IN (10.9%).

“Midwestern housing markets have held up relatively well because they remain affordable compared to pandemic boomtowns like Austin and Phoenix. That’s in part because they haven’t seen large waves of people moving in and out, which is what drove the booms and busts in many southern and western markets,” Redfin Deputy Chief Economist Taylor Marr.

Thank’s for reading! See you on Friday.

1 fun thing: With more pressing concerns at hand, olive oil drama stirs on LinkedIn.

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