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The Zacks Analyst Blog Dream Finders, Taylor Morrison, KB Home and Lennar

Zacks Equity Research
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In This Article:

For Immediate Releases

Chicago, IL – November 29, 2024 – Zacks.com announces the list of stocks and featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include including Dream Finders Homes, Inc. DFH, Taylor Morrison Home Corp. TMHC, KB Home KBH and Lennar Corp. LEN.

Here are highlights from Friday’s Analyst Blog:

New Home Sales Shrink in October: Here's What's Troubling Homebuyers

According to the U.S. Department of Housing and Urban Development and the U.S. Census Bureau, new single-family home sales declined 17.3% in October to 610,000 units (seasonally adjusted rate) from September 2024. The new home sales value of October reflects a 9.4% decline year over year.

The housing market in the country seems to be under pressure due to higher mortgage rates and increased material costs for builders, making it difficult for prospective buyers to make home-buying decisions.

Here’s What You Should Know About Housing Market Trends

Comparing year over year, the decline in new home sales was primarily due to a drop of 19.7% in the South and 1.3% in the West, partially offset by an increase in sales of 35.3% in the Northeast and 15.9% in the Midwest. On the other hand, when compared with the prior month, new home sales were negatively impacted by a decrease of 27.7% in the South and 9% in the West, partially offset by an increase of 53.3% in the Northeast and 1.4% in the Midwest.

The median new home sale price or ASP (average selling price) during the month was $437,300, up 2.6% from September 2024 and 4.7% year over year.

Per Danushka Nanayakkara-Skillington, NAHB’s assistant vice president for forecasting and analysis, “new construction remains a vital part of the market, especially in areas with low existing home inventory.” As of October, the new single-family home inventory was at a level of 481,000, up 8.8% year over year, representing about 9.5 months’ supply at the current building pace. Among the given inventory, ready-to-occupy inventory was 116,000, representing only 24% of total inventory.

Mortgage Rates & Other Economic Aspects

Per Freddie Mac, as of the week ending Oct. 31, the 30-year fixed-rate mortgage increased 64 basis points (bps) to 6.72% from 6.08% in the last week of September.

After the 50-bps interest rate cut on Sept. 18, 2024 and the 25-bps cut on Nov. 7, the current benchmark stands at 4.5-4.75%. Though inflation might have eased a bit, it is yet to reach the optimal rate of 2%. Although the Fed hinted toward rate cuts in the remainder of 2024 and 2025, the magnitude might not be as expected by investors. The rate cuts will indeed depend on how the market factors are acting toward easing inflation.

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