Elevated rates just made it harder to build more homes in America

Housing starts missed estimates today, which isn’t shocking, as builder sentiment plunged yesterday, hitting levels last seen in 2012. But as mortgage rates are parking near 7.5 %, housing construction looks challenging going into 2027. I spoke about this topic at HousingWire’s Homebuilder Summit yesterday and on today’s episode of the HousingWire Daily podcas. With rates in the mid 7s, the builders can try their best to keep new home sales from dropping further with rate buydowns, but with profit margins falling, it gets more and more difficult. From Census: Housing Starts: Privately-owned housing starts in September were at a seasonally adjusted annual rate of 1,221,000. This is 5.2 percent (±11.8 percent)* below the revised August estimate of 1,288,000 and is 7.4 percent (±11.5 percent)* below the September 2025 rate of 1,319,000. Single-family housing starts in September were at a rate of 859,000; this is 4.6 percent (±10.0 percent)* below the revised August figure of 900,000. The September rate for units in buildings with five units or more was 349,000. As you can see in the chart below, housing starts have been declining for years, which isn’t a surprise, as the builders are ...