Hot Housing Market Shows Signs of Cooling
A number of housing indicators seem to point to a slowing market, reports Ruth Mantell. "While residential investment will continue to add to economic growth, its contribution to gross domestic product is likely to narrow this quarter, with rising rates creating a downside risk for the housing sector’s outlook, according to Goldman’s Kris Dawsey and Marty Young."
"Data released Tuesday morning showed home prices continued to rise in June, but at a slower pace, echoing other reports showing a softening market. Last week, the government reported that sales of new homes in July fell 13.4%, slumping to the slowest annual pace since October, on drops across the country. Between early May and the end of July, mortgage rates increased about one point. Goldman had expected that a one-point mortgage-rate shock would only curb annual sales by about 7%."