Economists at Wells Fargo Securities are sticking with their theory that extremely wet weather in the South is responsible for the recent slowdown in new home construction and sales.
“Many outside the region may think blaming the weather is a little wonky,” according to the latest WFS Housing Data Wrap-Up report.
“But the South accounts for over half of all new home sales and new construction activity,” the Aug. 30 WFS report says. And the National Climatic Data Center has reported that “many metro areas within the South had their wettest July on record.”
The WFS economists recognize that the recent hike in mortgage rates also contributed to the slowdown and pushed some potential homebuyers out of the market. But they expect the impact will be temporary. Rates will “not ultimately impact the decision to buy, but rather will simply affect the timing of that decision and size and amenities of the home purchased,” the August report says
The WFS Economics Group has lowered its 2013 new home sales forecast by 10,000 units to 480,000 to reflect the
However, they expect a pickup in new home sales and starts in the second half if the weather cooperates.
“This trend will become most evident in the fall when sales and construction activity slow less than they usually do.”
