Fed lifts hopes but...

The NAHB home builder sentiment index for October rose 2 pts m/o/m to 43 though still well below 50. The estimate was 42. The Present Situation component was up 2 pts to 47 while the Expectations side was above 50 for a 2^nd month, up by 4 pts to 57 and likely optimistic with the Fed in rate cutting mode, though mortgages mostly price off the 10 yr which we know is higher.

Of note still, Prospective Buyers Traffic was well under 50 again at 29, though up 2 pts m/o/m.

The NAHB said “Despite the beginning of the Fed’s easing cycle, many prospective home buyers remain on the sideline waiting for lower interest rates. We are forecasting uneven declines for mortgage interest rates in the coming quarters, which will improve housing demand but place stress on building lot supplies due to tight lending conditions for development and construction loans.”