The Balance Today: News You Need To Know on Dec. 20, 2022

Weakening demand has soured homebuilders’ outlook on the housing market, and it shows in residential construction activity in November, according to today’s Census Bureau report. 

While the number of new homes that started construction in November was only down 0.5% from October, it was down 16.4% from November 2021. That’s more homes than economists expected, but it’s the third month in a row that the measure has declined.

While no one has a crystal ball that shows the future of the new homes market, the 11.2% dive that residential building permits took from October to November also indicates far fewer homes might be built in the new year.

If you thought 2023 could be your year to purchase a newly built home, you might have a number of challenges to contend with. You may be facing a shortage of options, especially if you’re looking for a single-family home in the Midwest, where new home builds dropped more than the national average. That’s not to mention your interest on a mortgage will likely be even higher than it would be now, as the Federal Reserve has pledged to continue raising interest rates. 

Existing homes may not be a better bet either. Tomorrow we will get a snapshot of that segment of the housing market when the National Association of Realtors releases their November report. But with economists estimating that November was the 11th straight month of declines in existing home sales, you could face similar headwinds when looking for a pre-existing home.