Published by FOX Business | August 4, 2022
The National Association of Home Builders CEO argues ‘we are in a recession’
National Association of Home Builders CEO Jerry Howard recently warned that the United States is currently in a housing affordability “crisis” caused by a supply shortage.
Speaking on “Varney & Co.” on August 3rd, he added that the housing market in his sector is “definitely” experiencing a slowdown.
“We are seeing reductions in traffic for new homes; we are seeing cancellations of contracts; building permits are going down. We believe we are in a recession.”
–Jerry Howard, National Association of Home Builders CEO
New home sales in June fell to the lowest level since April 2020, signaling declining builder sentiment as construction bottlenecks continue to slow new home building and raise housing costs, NAHB noted in a news release.
The association pointed to data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau, which revealed that sales of newly built, single-family homes in June fell 8.1% from May and that new home sales dropped 13.4% in 2022 year-to-date.
NAHB Chairman Jerry Konter, who is a home builder and developer from Savannah, Ga., noted that, “builders saw sales decline significantly as buyers were priced out of the market on higher interest rates,” also attributing the decline to the ongoing home building and development costs, including building materials.
NAHB’s assistant vice president for forecasting and analysis, Danushka Nanayakkara-Skillington, pointed out that “deteriorating affordability conditions and growing sticker shock” are contributing to the latest trends, as “only 14% of new home sales in June were priced below $300,000” compared to 27% the same time last year.
Nanayakkara-Skillington also noted that “inventory levels are elevated and will contribute to near-term production declines as the market finds a new balance.”