Zelman & Associates: Orders, Pricing Weaken on July Homebuilding Survey

(Image courtesy of Zelman & Associates)

Zelman & Associates, a Walker & Dunlop Company, New York, released the results of its July homebuilding survey, finding that July’s seasonally-adjusted order pace fell to the lowest level since December 2022.

Orders declined 9% sequentially, weaker than the typical 6% decline during the month pre-pandemic. On a year-over-year basis, orders were down 11%–the fourth consecutive decline.

Cancellations were 11% of gross orders–above year-ago levels, but still low, historically.

Starts declined 5% sequentially, the second consecutive pullback. They were also down slightly year-over-year.

The share of non-primary orders hit its highest level since November, at 11%.

Additionally, pricing was down 3% in July on a seasonally-adjusted annualized basis, the largest pullback since November. Year-over-year, net prices were up fractionally, but remain shaky.

The share of survey respondents raising prices was the lowest in a July since 2008, at 8%. Normal levels for the month usually hover around 30-35%.

Material and cost inflation was at 1.7% year-over-year, in line with the last year’s results.

Lumber costs have specifically eased, with futures down 20% from the near-term peak hit I March.

However, the price-versus-cost spread weakened for the fourth consecutive month and reached its most-negative level since October 2023.