Home News Lumber Prices Near Lows As Housing Starts Fall, Mortgage Rates Jump

Lumber Prices Near Lows As Housing Starts Fall, Mortgage Rates Jump

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  • Timber prices remained close to recent lows as new home construction declined while mortgage rates soared.
  • The number of housing starts in May decreased by 14.4% from the previous month to 1.55 million units, the lowest level in more than a year.
  • The average 30-year fixed rate mortgage for the week ending June 10 rose to 5.65%, the highest level since late 2008.

While mortgage rates reached their 14-year highs, timber prices on Friday remained close to recent lows as new home construction fell to its lowest level in more than a year.

After a recent drop in prices, prices were around $ 569 per $ 1,000 board foot, up less than 1% from Thursday. Lowest score in 9 months..

Lumber price The housing market has cooled in response to rising interest rates, dropping more than 60% from the March highs. on wednesday,


Federal Reserve

Benchmark rates have been raised by 75 basis points to curb soaring inflation. This is the biggest increase since 1994.

The rise in interest rates is a sharp recovery from recent years when ultra-low borrowing costs have spurred a surge in home buying and selling, which has fueled the housing market.

But more and more hawkish central banks are also raising mortgage rates, lowering affordable housing prices and curbing demand for building materials such as timber.

According to the Mortgage Banking Association, average 30-year fixed-rate mortgages for the week to June 10 rose 25 basis points to 5.65%, the highest level since late 2008. In addition, purchase applications have decreased by more than 15% from a year ago.

On the other hand, the number of new constructions is also decreasing, and the number of housing starts in May decreased by 14.4% from the previous month to 1.55 million units, the lowest level in more than a year. Census Bureau I said on Thursday. The volume of permit applications, a preferred indicator for future construction projects, has dropped to a minimum of 1.7 million in nine months.

Insider reported earlier Eighty percent of buyers think it’s not a good time to buy a home in the current market. Pessimism comes as Freddie Mac economists warned The US housing market could shrink as aggressively as it did in 2006.

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