This week will bring a bevy of fresh data on the housing market. With the Federal Reserve expected to raise interest rates by another 75 basis points (bps) next week, and the average rate on a 30-year fixed-rate mortgage back above 5.5%, the releases could offer more insights on how rising rates are affecting the housing market.
First up will be this morning's NAHB/Wells Fargo Housing Market Index for July. The index is expected to fall one point to a reading of 66 in July, from 67 last month. That would mark a seventh straight month of declining homebuilder confidence and a two-year low for the index.
Tomorrow, the Commerce Department is expected to show that housing starts likely rose to 1.6 million units in June, from 1.5 million units in May. Permits for future homebuilding likely fell to 1.65 million units in June, down from 1.7 million units in the month before.
On Wednesday, the National Association of Realtors will report on existing home sales for June, which are projected to drop to 5.38 million units, from 5.41 million in May. Home sales have declined steeply this year, as the combination of rising mortgage rates and higher prices discourage many prospective homebuyers.
Last Friday, Wells Fargo, which is the fourth-largest U.S. mortgage lender by volume, said its second-quarter profit was nearly cut in half as the bank set aside more funds to cover potential loan losses. The bank reported that revenue from its home loans fell 53% from a year ago.