Homebuilders have no motivation to grow permits with 7% rates
By: Logan Mohtashami | Published: 2025-06-18 17:28:00 | Source: www.housingwire.com
As I noted in June 2021 that rising mortgage rates would ultimately signal the end of the housing construction cycle. Fortunately, large builders have maintained sufficient profit margins to prevent the situation from worsening. However, as active inventory in the resale market continues to grow, it will become increasingly complex to build more homes with mortgage rates near 7%.
From Census: Housing Starts: Privately-owned housing starts in May were at a seasonally adjusted annual rate of 1,256,000. This is 9.8 percent (±9.3 percent) below the revised April estimate of 1,392,000 and is 4.6 percent (±8.3 percent)* below the May 2024 rate of 1,316,000.
Building Permits: Privately-owned housing units authorized by building permits in May were at a seasonally adjusted annual rate of…
