Last week’s economic reporting included readings on home builder confidence and weekly reports on mortgage rates and jobless claims.
NAHB: Home builder confidence increases in April
According to the National Association of Home Builders (NAHB), builder confidence in the current housing market conditions increased by one point to an index reading of 45 in April. This was the fourth consecutive month that builder confidence has increased. While builder confidence in current housing market conditions rose two points, builder confidence in expected sales over the next six months rose three points, and builder confidence in prospective buyer traffic in new housing developments remained unchanged from March.
Homebuilders offer buyer incentives
Due to the shortage of previously-owned homes available for sale, homebuilders are offering incentives to buyers. Around 30 percent of homebuilders have lowered the prices on new homes by an average discount of six percent. Currently, one-third of the housing inventory is new construction compared to the historical norm of a little more than ten percent. However, there is no evidence that pressure on the regional bank system has made the lending environment worse for builders and land developers.
Mortgage rates and jobless claims rise
Freddie Mac reported higher average mortgage rates last week. The average rate for 30-year fixed-rate mortgages increased by 12 basis points to 6.39 percent, and rates for 15-year fixed-rate mortgages rose by 22 basis points to 5.76 percent. In addition, 245,000 initial jobless claims were filed last week, higher than the expected reading of 244,000 first-time claims filed and the prior week’s reading of 240,000 first-time claims filed.
Upcoming economic reports
This week’s scheduled economic reports include readings on housing markets and home prices. Data on new home sales and pending home sales will be published along with weekly readings on mortgage rates and jobless claims.