Interesting housing point on Millennials. If born in early 1980s & bought home in your early 30s, timing worked well (great affordability & rode wave of home price gains). Different story for Millennials born early 1990s trying to buy 30 years later in 2020s. ⁦@jean_twenge⁩

As the 'official' May housing data trickles in over coming weeks, the divergence between new home and resale market should get even more glaring. May new home sales +18% YOY per our builder survey. Housing starts on the upswing too as builders step on the gas.

Home builders had yet another strong month of sales in May. Monthly pace of sales 30% above May sales in 2013 to 2019 (more normal years). In addition, May 2023 sales rate exceeded May 2020, May 2022, and was in line with May 2021, all of which were phenomenal sales periods.

Update on public home builder market share shifts. $DHI and $LEN battling it out for top spot as always. Combined, these two builders now account for 21% of all new home sales in the US.

Good example of home builders making tweaks to get more buyers through the door (aside from rate buydowns). Price per square foot on communities 'coming soon' (green line) now down -13% YOY for publicly traded home builders based on our monthly tracking.

Some of my top takeaways from our @JBREC client housing Summit conference last week. 1) Supply chain across new home construction (namely land) remains structurally broken. While things have improved for sure, new normal of bottlenecks everywhere likely creates a ceiling on…

Today’s resale sales print hammers home 2023 housing theme noted below. Builders keep successfully stepping into resale housing supply void, and at sweetheart rates for buyers.

Home builder gross margins have moderated, which was inevitable. Perhaps more interesting is how several builders are already noting margins stabilizing, which based on this chart would still be above normal levels.

Similarities in these auto industry comments to housing dynamics today: “As long as rates don’t rise rapidly again and used-car pricing stays pretty consistent so the customer has equity to offset interest rates, I don’t think it’s going to affect sales.”

Public home builders have 18% more actively selling communities vs. one year ago. Coming into 2023 this anticipated supply spike was viewed as a negative given expectations for soft spring, but it's actually turning out to be a good thing. Wild year so far for housing!

Heard it loud and clear on $DHI earnings call this morning.

Mortgage rates aren't 6.75%, they're 4.99% to 5.5% (IF you buy from a builder). It's an offer many homebuyers can't refuse.

Good summary on upswing in immigration from ⁦@RanaForoohar⁩. Ties with optimism our ⁦demographics team ⁦@DemographChris⁩ & ⁦@EricFinnigan⁩ have been noting in recent flurry of fresh charts.

Interest rates, the Fed, and regulatory oversight are all top of mind for housing and the economy. Looking forward to discussing these topics during 1-on-1 chats with experts/authors James ‘Jim’ Grant @GrantsPub and @MarkCalabria at our upcoming Summit conference May 23-24.

We also asked about builders' preparations for potential FUTURE lending restrictions. Quite a few mentioned diversifying their lender base, with private equity noted often.

Given banking volatility, we asked home builders about any new restrictions on construction and land acquisition financing. No impact to date for 48% of builders, with a mix of changes for others such as higher cost of debt (16%), more equity required in the deal (12%), etc.

Bank stress isn't slowing home builder sales. Strong March according to our survey, namely housing starts.

So many home price indices out there (including ours). Here's what actual resale agents we survey monthly think about YOY home price trends through February. National home prices -1% YOY, ranging from +3% YOY in the Northeast to -7% YOY in both Southern and Northern California.

@NewsLambert @JBREC Cancellation rates normalized some more through the first half of March according to our mid-month builder channel check.

Then you get Phase 2 where the actual asset quality starts to get exposed. That's where peeling back the layers on types of real estate exposure will become more relevant (reason for the chart earlier).

Many similarities to Savings & Loan crisis in terms of phase 1 being duration mismatch exposure when rates explode (flashback below to that period)...

Real estate exposure front and center for regional banks.

2023 could be a year where home builders grow market share (new homes are just 11% of total home sales today). Resale housing dynamics tee it up nicely: limited supply, lock-in effect, sellers still reluctant to drop price, and can't really use rate buydown lever like builders.

Unfortunately, home prices in tech and venture capital hubs are already down the most from 2022 peaks for markets we track across the country. Any additional setbacks for tech & VC (now brewing) aren't ideal.

Another great #housing Odd Lots ⁦@TheStalwart⁩ ⁦@tracyalloway⁩ . Can confirm @AZLandInvestor comment on many builders restarting land acquisition in recent weeks. Appreciate the @JBREC shoutout for our recent under/oversupply market analysis.