National Association of Home Builders CEO Jerry Howard joins Yahoo Finance Live to discuss the decline of housing in the United States amid Fed interest rate hikes, regulatory inaction, and recession risks.
Video Transcript
DAVE BRIGGS: All right, let's talk housing. The Fed's aggressive monetary policy to get inflation under control is impacting the housing market. High mortgage rates leading to a decline in demand. US homebuilding fell more than expected last month. Housing starts dropping more than 8% in September. Building permits up slightly at 1.4%. But one of the biggest laggards, a 13% drop in multi-unit projects.
National Association of Homebuilders CEO Gerry Howard joins us now with more on all this data. Good to see you, sir. All this data continues to pour in, showing essentially the same things. We're right around early 2020 levels, pre-- or right when the pandemic took hold. What concerns you the most about what's to come?
GERALD HOWARD: Well, that's an interesting question. I think what concerns me the most is the failure of public policymakers to act to stem the tide of this housing recession. Virtually every reason that we are currently in a housing recession is tied directly to public policy. Whether it's interest rates being raised-- and by the way, those interest rates not only impact the housing consumer, they impact the builder at the frontend of the pipeline as the cost of capital for the builders has gone up to get the loans to acquire the land, develop it, and construct the homes.
It's a double whammy on the cost of capital. We're still having labor problems. We've got to get our immigration situation fixed. We're still having supply chain problems as a hangover from the pandemic. And we're still having regulatory problems, whether it's regulations involving the importation of lumber from Canada, labor regulations, environmental regulations, or simply the reinstitution of the regulations that the Trump administration did away with.
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