It’s no wonder homebuilder confidence fell so sharply…
…since they knew about the decline occurring in permits and starts. This is the worst print since the depths of the pandemic in June 20 and is precisely what we warned about in July 2021 [see: Time to Sell Your Home?]
Recall that in the 19% house price correction between 2007-2009, the peak in starts preceded the peak in prices by 14 months. But, prices had already dipped lower – between Jan-Jul 2006.
The Fed saw the writing on the wall, halting the steady rate hike which had started in June 2003 at 1.0%. But, it was too late. The unwind had started, and prices would drop until Jan 2009 – much longer than that for many homeowners.
Futures had already rolled over, but this was more fuel to the fire.
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