Developers’ view on new home demand improves in July 2024 but remains very subdued – Quick Facts – 185

In July 2024, real estate developers’ views on new housing demand improved significantly compared to April, but still fell sharply. Their views on the outlook for new housing starts stabilized and remained very pessimistic. In addition, developers expected their customers’ financing capacity to decline.

In July 2024, after more than a year at historic lows, developers’ sentiment on demand recovered significantly. Despite the recovery, it remains well below the long-term average.

However, developers remain as pessimistic about the outlook for housing starts as in April: the corresponding global balance remains stable and well above average. Specifically, the balance for the outlook for homes for sale has recovered slightly, but remains significantly below average. In contrast, the balance for the outlook for rental homes in the social housing sector has declined slightly and is slightly below the long-term average.

Compared to the previous quarter, slightly fewer developers said they were considering studying new construction plans: their share fell slightly, but it remains low and well below the long-term average.

The balance of opinion on unsold homes continued to decline but remained well above the long-term average.

In July 2024, real estate developers were less optimistic about the prospects for the development of financing capabilities for new homes over the next three months than in the previous quarter. The balance of opinion fell after two consecutive quarters of increases and returned to its long-term average.

The balance of opinion on the change in the average down payment required by applicants to purchase a new home over the past three months has declined and has again fallen below its long-term average.

After two years of significant consecutive declines, the balance of opinions regarding the evolution of the expected average price of homes for sale has stabilized below its mean.