"While homebuilder sentiment remains subdued after a 12-month grind that hasn't quite let up, Robert Dietz, Chief Economist for the National Association of Home Builders, offered guarded optimism in his take on housing economics' complex set of market drivers. In other words, the worst of the worst may be over, but don't expect a switch to flip. Not yet, anyway."
"Still beset by economic uncertainty and an affordability chasm for would-be homebuyers, Dietz detects the first positive signals and clues that new-home sales may surface from doom-and-gloom toward an early-stage recovery by the end of 2026. There is evidence, Dietz noted, that affordability pressures have bottomed out and are improving, and an anticipated moderation in mortgage rates could start to release pent-up demand in a hazy, not too distant future."
"Dietz described the macroeconomic outlook as good, but not great. Annual GDP growth rate, he noted, is positive at about 2.2%, but it is lower than the long-term average growth rate of 3.0%. On a positive note, the three- to four-year outlook includes a relatively low 30% recession risk. Economic growth, of course, varies greatly depending on the state and region."
NAHB forecasts a modest 1% increase in housing starts for 2026 with improving affordability and mortgage rates likely to remain steady or decline. Homebuilder sentiment remains subdued after a prolonged 12-month downturn, but early indicators suggest new-home sales could begin a gradual recovery by late 2026 as pent-up demand emerges. Macroeconomic conditions show positive yet below-average GDP growth around 2.2% and a three-to-four-year recession risk near 30%. Job growth diverges by state, with some regions still below pre-COVID peaks while others experienced strong gains. Productivity and household income growth are key metrics to monitor.
Read at www.housingwire.com
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