Rates ease while residential construction spending falls for a fourth straight month
The 30-year fixed eased three basis points to 6.88% and the 15-year to 6.48%. FHA sits at 6.44% and VA at 6.46%, the cheapest on the board; the 7/6 ARM slipped to 6.47%. Jumbo went the other way, up five basis points to 7.05%. Prime holds at 6.75% as of September 2 — floating construction lines did not reprice.
NAR's Pending Home Sales Index fell 2.3% in July to 71.2, the lowest reading since January and down 2.2% year over year, with all four regions declining. Inventory held at a 4.6-month supply and the median existing-home price at $431,400.
The Census Bureau reported September 1 that private residential construction spending fell to an $859.0 billion annual rate in July, down 1.3% for the month and 7.3% from a year ago — a fourth straight decline, led by single-family at -3.2%. Private nonresidential rose 0.4% to $755.2 billion, its fourth straight gain.
Lumber futures traded at $574 per thousand board feet Thursday, up 1.9% on the day but still about 2% below a month ago. The framing lumber composite NAHB tracks fell to $521.35 the week of August 28, a third straight weekly decline. BLS JOLTS put construction job openings above 300,000 at the end of June, up 36% year over year.
Point capital at what is getting funded: nonresidential spending is in its fourth month of growth while single-family is in its fourth month of decline. Lock framing budgets against the cash-market softness rather than waiting on futures, which have already turned back up. Staff crews before you bid — with openings up 36%, labor is the schedule risk, not lumber.