The market for newly-built homes for over 55s are facing various headwinds which have slightly weakened a measure of builder confidence.
The National Association of Home Builders’ 55+ Housing Market Index was down in the third quarter of 2018 as all four of its components slipped.
“Although various headwinds are starting to have an impact on the 55+ housing market, there are many parts of the country where the market is still doing well,” said Chuck Ellison, chairman of NAHB's 55+ Housing Industry Council. “In some places it is becoming a challenge for builders to provide housing at prices their customers can afford.”
When compared to Q2 2018, all three single-family components saw a decline: present sales dropped seven points to 66, sales expected in the next six months fell 12 points to 65 and traffic of prospective buyers dipped four points to 43.
“The decline in the single-family 55+ HMI is consistent with the recent weakness in new and existing home sales,” said NAHB Chief Economist Robert Dietz. “The high readings seen in the previous three quarters are not sustainable with high construction costs and rising interest rates.”
Condos, rentals lower
It was the same story for 55+ condos, with present sales and traffic of perspective buyers both down 13 points to 48 and 31, respectively, and sales expected in the next six months down 10 points to 53.
And for the multifamily rental sector for 55+, present production and demand expected in the next six months both fell 11 points to 54 and 64, respectively, production expected in the next six months dropped 12 points to 56 and present demand for existing units edged down nine points to 63.
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