David Seiders
David Seiders
builders demand incentives market marking rolling sales sort starts
The big builders are marking down their outlooks for 2006 and rolling out some sales incentives -- the sort of things we see when the market starts to weaken on the demand side.
activity classic cooling cycle economic housing leading levels process sort systematic toward viewed
I do have this sort of weakening of the housing sector, but I think it should be thought of as a systematic cooling down process toward sustainable levels of activity and not viewed as kind of a classic housing downswing that's part of an economic cycle leading to a recession.
beginning cooling housing starts
We see a flattening of housing starts and the beginning of a cooling process.
component economy element engine expecting growth move negative neutral next strong year
I've been expecting the housing-production component of GDP to move from a strong growth engine to a neutral or negative element in the U.S. economy over the next year and a half.
april builders couple declines economy evidence highly housing including last losing momentum numbers showing shown starting supposedly survey
There's other housing numbers showing some declines in April as well. My own survey of builders has shown them losing some momentum for the last couple of months, including May. I think there's some evidence accumulating that this supposedly highly interest-sensitive part of the economy is starting to give ground.
balance builders generally healthy maintained supply throughout
As they generally have done throughout 2005, builders have maintained a healthy balance between supply and demand.
balanced buyers market switching
We are switching from a red-hot sellers' market to a market that is better balanced between buyers and sellers.
certainly inevitable rate record return seeing sign slow terms
We're certainly seeing a record rate of return in real terms (after factoring out inflation), and there has been very little sign of deceleration. But it is probably inevitable that some of this will slow down.
bad conditions country january parts unusually weather
We had unusually bad weather in many parts of the country in December, and the conditions in January were extraordinarily warm.
delighted housing market obviously tells
I was obviously delighted to see this rebound. I think what it tells us is that the housing market is still fundamentally strong.
sting takes weather winter
Winter weather really takes the sting out of these declines.
healthy hold last pace
We can't hold at the pace we had last year. It's not going to be the end of the world -- it's going to be a simmering down to a very healthy pace.
alignment depends economy happens interest market moving rate rates
Now what happens to the market depends on the interest rate structure. Long rates have been better than expected, but I think we can see them rising, moving into alignment with what's going on with the economy and with short-term rates.
consistent orderly process recent
The recent stabilization is consistent with the orderly cooling-down process that NAHB has been forecasting.