New construction is at the lowest level since June 2020.
The Commerce Department reported the number of housing starts decreased sharply in July. Measured on an annualized rate, the contraction last month amounted to 9.6 percent, which equates to 1.45 million housing starts.
Additionally, permits to build, which are a proxy for future construction, decreased by 1.3 percent in July. Permits for single-family homes dropped 4.3 percent while permits for multi-family projects rose 2.5 percent.
As the Federal Reserve has raised the interest rate to reduce inflation, the mortgage lending rate, which corresponds with U.S. Treasury yields, has risen as well. According to Freddie Mac data, the average 30-year fixed-rate mortgage, which began the year at 3.22 percent, is currently at 5.22 percent.
As the Lord Leads, Pray with Us…
- For Freddie Mac CEO Michael DeVito as he oversees the mortgage service board.
- For Secretary Raimondo to seek God’s wisdom as she manages the Commerce Department.
- That Chairman Powell and other members of the Federal Reserve Board address inflation with discernment.
Sources: Washington Examiner, Wall Street Journal, Reuters
