Builder confidence and housing affordability continued to decline given the rapidly rising interest rates combined with higher construction costs and ongoing home price increases, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
The index shaved two points off of builder confidence in newly built single-family homes in this latest reading.
"In the construction financing world, rising rates make an already challenging development deal even more difficult," Paul Rahimian, CEO, Parkview Financial, tells GlobeSt.com. "With construction costs rising, the addition of higher financing costs, could lead to a slowdown of real estate development and a pull back by developers, which would only increase the lack of supply of some commercial real estate, such as multifamily.
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