New home building in the U.S. continues to fall

In November, home building declined again. Buyers faced a sharp increase in mortgage rates to 7%. In this regard, homes became unaffordable. During the month, mortgage rates declined slightly, but are still double last year's rates, which significantly affects the purchase of new homes.

New home construction in November decreased by 0.5% compared to the previous month, and by 16.4% compared to the same period last year.

Building permits also fell 11.2% in November from the previous month, and 22.4% from the same period last year.

According to Robert Frick, a corporate economist at Navy Federal Credit Union, the home building market fell even more in November. He also added that taking into account comparatively high mortgage rates, it is difficult to form a view of where the fall will stop. In his opinion, potential homebuyers may feel a little relief in 2023 from lower mortgage rates and maybe lower home prices.