Yahoo Finance Video
Ahead of the highly anticipated Federal Reserve rate decision on Wednesday, CEO and President of the National Association of Home Builders (NAHB) Jim Tobin joins Yahoo Finance Live to share his insights on the outlook for the housing market. Tobin expresses optimism, describing 2024 as "this pivot year," where he expects rates to come down and demand to start rebounding in the housing market. He believes "the economy will keep moving along at a nice pace," with rates potentially declining in the second half of the year. While acknowledging concerns about shelter inflation, Tobin encourages "people to get used to the new normal" of mortgage rates, rather than hoping for a return to the 3-4% range. Addressing the costs of new home construction, Tobin attributes the challenges to the inability to keep up with demand. He notes that "price spikes," especially with lumber (LBR=F), occurred "right after the COVID lockdowns when homebuilding really got going." However, he cautions that lumber companies are not "getting ready for a surge in demand," and if this demand does return, it could create "a supply crunch," forcing lumber companies to play catch-up, ultimately leading to higher construction costs. For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live. Editor's note: This article was written by Angel Smith
