Week in Review: May 16-20
Zack here, filling in for Anirban to review a week absolutely loaded with housing market indicators.
White House Plan on Reducing Housing Costs
We’ve been hard on this POTUS’s policies lately, but this one is loaded with good stuff like rewarding jurisdictions that reform zoning and land use policies, encouraging the use of manufactured homes, and helping with financing certain kinds of housing. The federal government is pretty limited in its ability to fix a lot of the underlying issues behind housing shortages, but this is a good start at addressing the problem and a great way to start to the week.
The U.S. consumer keeps chugging along; retail and food service sales increased 0.9% in April and are up 8.2% over the past year. Through the first four months of 2022, retail sales are 11.3% higher than they were over the same period in 2021. These data aren’t inflation-adjusted, and real retail sales were pretty much flat on a yearly basis, though they rose on a monthly basis.
Jerome Powell Speech
Jerome Powell, Chairman of the Fed, did an interview with the Wall Street Journal. He’s committed to seeing “inflation coming down in a clear and convincing way, and we’re going to keep pushing until we see that.” By pushing, he means raising rates and reducing their balance sheet. If you’re not totally sure what that means, check out our very basic primer on interest rates.
NAHB/ Wells Fargo Housing Market Index
This index of home builder confidence fell pretty sharply in May due to higher high home prices, rising mortgage rates, and ongoing material cost inflation and shortages. Homebuilder confidence is now at its lowest levels since mid-2020, and that sounds about right given the headwinds listed above.
Building Permits, Housing Starts, & Housing Completions
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