For months, construction and remodeling activity has been rapidly cooling down.
Additionally, for all of 2019, BuildFax Housing Health Reports have revealed that single-family housing authorizations – what it considers a key indicator of historic recessions – have been decreasing.
But the latest BuildFax Housing Health Report has a different tune to it.
According to the report, single-family housing authorizations rose 3.57% month over month in September. However, this still represents a 0.13% decrease year over year.
But the report states that there may some light at the end of the tunnel.
“The trailing three-month outlook (July to September 2019) decreased 2.11%,” the report stated. “The rate of new construction is still shy of 2018’s rapid pace, but month-over-month increases suggest lower mortgage rates are providing a slight boost to the market.”
The report also looked at existing housing construction, including maintenance and remodeling.
Year over year, existing maintenance volume and spend increased by 5.54% and 10.33%, respectively. According to the report, the increases in housing activity suggest lower mortgage rates could be providing a slight boost to the market. Remodel volume and spend — including renovations, additions and alterations — increased 7.22% and 9.55%, respectively.
“The housing market is beating expectations this month both through the lens of construction activity and home sales, which posted notable growth in September. Single-family housing authorizations and existing home sales have risen to highs not seen in a year,” said Jonathan Kanarek, COO of BuildFax.
“Amidst concerns of a recession, it’s promising to see the housing market responding to the impact of mortgage rate decreases and other positive moves in the market,” he continued. “If housing continues showing the promise of growth, or even a leveling off, this activity has the potential to stimulate the larger economy.”
