This is the kitchen table conversation that drives these forecasts:
"Do you think I should try to buy that house? I really love it."
"Let's wait and see if these tariffs come back in 90 days, and if we still have our jobs and savings."
This is what I said last month:
Home mover numbers will rise until summer.
Nope.
We predicted that even though numbers are down from 2024, every month we’d see an increase in movers, until summer. This has also proven INCORRECT. Even when the news was telling us that things are getting worse and worse, as the winter/spring went on we were seeing more individuals intending to buy homes through April.
Until now…..
To be clear: new home sales still had a good March, but existing home sales did not. April home sales (new and existing) seem lower than March.
My Ed-torial opinion is:
Homebuilder CEOs are not experiencing large cost increases because they already purchased their supplies and labor is hired. Rates have been 7% for a while and people who need to move will try to move.
But, like I always say, THE CONSUMER IS IN CONTROL
In talking to a CEO of a major home builder he reflected that consumer sentiment based on news headlines is what is driving home sales up or down, literally daily and weekly. When major fear comes out of the national news, that is when people we see home sales dip (“Nah, let’s wait”).
Six-year aperture: 2025 will still see many more new construction homes selling than in 2022, so CEOs are taking it all in stride especially as they buy-down rates. Only 2 of the top 20 home builders sold fewer homes in 2024 than in 2022. Most builders are selling more!
For major homebuilders a good economy or weakened consumer sentiment doesn't matter. If you have 500 homes to sell, there ARE 500 buyers for them, but you have to find them. What really matters is knowing WHO is buying and WHERE they are. Which makes investing in that information more important than ever (reply to this email if you want to know more).
Homebuilders are also now focused on land acquisition, getting ready to build homes when the market gets hot again.There is land to buy, so they are getting ready for 2026-2028.
Consumers are in control and headlines are driving them to slow down. But there are buyers, find them and sell them homes. This too shall pass.
Ed Carey - CEO, Audience Town