Homebuilders are returning to the single-family market. But it won’t be enough

After falling in July, housing starts were back up again in August, according to data released Wednesday by the U.S. Census Bureau and the U.S. Department of Housing and Urban Development (HUD).In August, housing starts rose to a seasonally adjusted annual rate of 1.356 million, up 2.9% month over month and up 3.9% compared to a year ago. The single-family sector was the sole source of thus increase, as multifamily starts were down 6.7% monthly and 6.2% annually to a rate of 333,000 starts. In contract, single-family housing starts were up 15.8% month over month and 5.2% annually in August to a rate of 992,000 starts.“Slowdowns in new single-family construction over the summer reflected sagging builder confidence, but homebuilders appear to be more confident as mortgage rates have fallen over the past few weeks and as the Federal Reserve gets set to cut interest rates. Therefore, it is likely that we will see an uptick in new housing starts over the coming months,” Lisa Sturtevant, the chief economist at Bright MLS, said in a statement.Like starts, the number of permits issued also rose on a monthly basis in August, jumping 4.9% to 1.475 million. However, on a yearly basis, the pace at which permits were issued was down 6.5%. This trend was consistent across both the multifamily (451,000 permits) and single-family (967,000 permits) sectors, which posted 8.4% and 2.8% monthly increases and 16.8% and 0.5% yearly decreases, respectively.“Despite the uptick in new housing starts last month, data on housing permits—which provide a leading indicator of future housing starts—were down compared to a year ago, suggesting that the delivery of new homes in 2025 could be lower than it was in either 2023 or 2024 when new housing construction, particularly apartment construction, was strong,” Sturtevant said. “The pace of apartment construction has slowed as record numbers of units have been delivered over the past 12 months and rent growth has slowed.”While the pace of apartment construction may be cooling, the multifamily sector was the primary driver behind the 9.2% monthly increase and 30.2% annual increase in housing completions, which were at a pace of 1.788 million in August. The multifamily sector (740,000 completions) posted a 36.5% month-over-month gain and a 79.2% year-over-year increase in August, while the single-family sector (1.029 million completions) fell 5.6% month over month, but rose 8.4% annually.Despite the mixed results, some economists are optimistic about the future of the new construction market.“Starts and permits are still lower than levels from earlier this year, but combined with lower mortgage rates and pending Fed rate cuts, today’s data could be the start of a home-building revival,” Robert Frick, a corporate economist at Navy Federal Credit Union, said in a statement. “Builders not only will enjoy higher demand for homes as lower mortgage rates make them more affordable, their cost of building will drop and that will expand their margins and encourage more building.”On a regional level, the Northeast (117,000 starts) posted the sole monthly and year declines, dropping 27.3% from a month ago and 7.9% from a year prior. The Midwest (206,000 starts) posted the largest monthly gain, jumping 29.6%, followed by the South (745,000 starts), which rose 15.5% and the West (288,000 starts), which was up 5.9%.On a year-over-year basis, the Midwest (+28.0%) also posted the largest gain, followed by the South (+1.9%) and the West (+0.7%).While an increase in housing starts combined with lower mortgage rates and an impending Fed interest rate cut are good signs for the housing market, Sturtevant is uncertain it will be enough.“There is a structural housing shortfall in the U.S. of between 1.5 million and 5.5 million housing units, depending on the source. A lack of supply is the primary driver of high home prices and worsening affordability in the U.S.,” she said. “It is promising that housing supply issues are gaining traction at the local, state, and, increasingly, the federal levels. For the first time in recent memory, housing has been part of the Presidential candidates’ platforms. However, there is no magic bullet and no short-term fixes for increasing the housing supply.”

Opinion: Are you thriving or barely surviving in the shifting mortgage industry?

For those of us in the mortgage world, the spring and summer market may be showing some signs of slowing down, and what a ride this market has been. If the past few years have taught us anything, even the veterans must find ways to adapt, and anything can happen in our industry. You deserve a pat on the back if you are still standing because it has been a wild ride. We have been through a pandemic, and many came out feeling like they and their business were invincible. Fast forward to post-pandemic, and we have endured interest rate increases, political shifts, inventory shortages, and, in some instances, a significant decrease in revenue and production. It is a hard truth for many, but it also gives way to new ideas and opportunities if you take hold of them. Earlier this year, I found myself scrolling through social media, and every post seemed to be loan officers living the high life, with what seemed like endless closings, all while hosting event after event. I was feeling a bit drained from it all, and truth be told, it made me feel as though I had lost the “it” factor I once had in this industry. You see, social media glorifies success; think about it. How often do you see many of your peers showing the struggle or sharing what it took to get to those levels of personal success? You don’t see it often because we can portray ourselves as whatever we want online, and who wants to look average? There are more smoke and mirrors online than you may think, and it’s easy to get caught up in the glitz and glamor that everyone sells. The truth is, not everyone is doing as well as they appear. I had a Recruiter contact me the other day, and he mentioned to the average loan officer that he has been speaking with an average of 1.6 loans per month, which puts things into perspective. There are months when we may have multiple closings and then others with just one or none. It happens, and honestly, it doesn’t make you any less successful; it just means you have a little more time to find ways to increase your production if you wish. I myself work among the best of the best in the mortgage industry. The company I work for and the region I am aligned with houses more top 1% loan originators than some companies combined and while I feel like I am a small fish in a big pond I have found ways to learn from and thrive off the success sharing of those around me. While it may be difficult to drop the ego or humble yourself to ask others for help, this is a great time to do so. You would be surprised how many others around you may be struggling or have struggled in the past and can share their stories and journey. Not only does it offer some solace that others may have felt the same emotions in this industry, but it also helps build new relationships that you may have not gained otherwise. Asking questions and leaning on others to help can be awkward but can also shed light on new ways to pivot your business model. Finding a mentor can be a valuable tool for both personal and professional growth, even if they are outside of your current company. You may be surprised by what you can learn from one another.Those that have thrived even during the downturn usually share two common themes: process controls and consistency. Your process is your calling card. Now is a great time to step back and look at the processes you have in place and determine if they are effective. If there is one constant in this industry, it is changing, and if you find yourself struggling to adapt to change, you will most likely struggle to stay afloat in this market. Having solid processes in place can mean the difference between thriving and survival modes. Evaluate the processes you can control, and you will start to see results over time. Consistency is another crucial component to success within the mortgage space. You have to be consistent in every aspect of your day-to-day business operations. Whether setting goals before you start your day or carving out time for your outreach efforts throughout the day. Without consistency, you will never see results. This is one space I genuinely find myself needing the most help with. I easily get trapped in the joys of the high-production months, which means I run at full speed and sometimes neglect my daily activities, leading to inconsistencies. Trust me when I tell you that your referral partners can also see and feel when you are busy vs. when you may be less busy. Our job is to treat every day as an opportunity to display what sets us apart, and the key to this is process and consistency.Remember, you are not alone when you feel overwhelmed within the mortgage space. Many of us have found ourselves in positions that evoke many emotions, but now is the time to evaluate your current business model, get out of your comfort zone, and start implementing new procedures to help elevate yourself personally and professionally. In such a competitive industry, knowing that others may be in the same space is good. I can only hope that anyone reading this finds the strength to reach out and lean on others. You got this!Tracy Chongling is the VP of Mortgage Lending at Guaranteed Rate.This column does not necessarily reflect the opinion of HousingWire’s editorial department and its owners.To contact the editor responsible for this piece: zeb@hwmedia.com.

’Where the rubber meets the road’: New Hampshire brokers reflect on the NAR settlement

For agents in New Hampshire, this week marks two months since PrimeMLS, the state’s multiple listing service, implemented the business practice changes outlined in the National Association of Realtors’ nationwide commission lawsuit settlement agreement.In these two months, one overwhelming trend has emerged — everyone is handling the changes a bit differently. Brokers from across the state dove into these difference during a panel discussion at the New Hampshire Association of Realtors’ (NHAR) conference on Tuesday in Concord.“Everyone is adapting and coming up with business models and trying to settle in, and I think we are going to know a lot more about how this is going to really work a year from now,” said Matt Johnson, NHAR’s legal counsel. “So, for now, I would caution patience.”According to the panelists, the largest discrepancies are occurring in how agents and brokerages are handling buy-side agent commissions now that offers of compensation are no longer allowed to be disclosed on the MLS.“What we are seeing is kind of two buckets,” said Adam Dean, the broker-owner of Duston Leddy Real Estate. “In one bucket are agents and listings who are not sharing what they are offering for buy-side compensation and are instructing buyers to write all their asks into their offer. In the other are sellers who are choosing to advertise the buyer broker compensation they are offering in all allowable channels.”While brokers said they are happy to work with sellers who are not disclosing offers of buyer broker compensation, Dean noted that if the listing agreement specifies a certain amount of buyer broker compensation will be offered, the listing agent should disclose that information if asked.“If you are telling buyer’s agents they can ask for buyer broker compensation in their buyer’s offer, your listing agreement better reflect that,” Dean said. ”If your listing agreement has a number there and you aren’t disclosing it when your seller said you can, then we have an ethical issue.”Susan Cole, the broker-owner of Susan Cole Realty Group, noted at the end of the day, it is important for agents and brokers to remember that the seller is in the driver’s seat when it comes to how compensation is handled.“I think, before, a lot of folks looked at it as this is our compensation and we are sharing it, but now we have to remember that that is not the way in which this class-action lawsuit settled itself,” Cole said. “If we are listing agents, we can’t share our compensation unless the seller instructs us to do that. It is a seller decision, not an agent decision.”Regardless of how agents and their clients are handling compensation in any given transaction, brokers agree that in order to make everything clear for all parties involved, it is best to include how the buyer broker fees are being handled in both the purchase and sales contracts being submitted with an offer.“If I, as the listing agent, don’t see an ask for buyer broker compensation on the purchase and sale, I am going to assume that you guys have it covered and that my seller doesn’t have to pay or even consider that fee,” NHAR President Joanie McIntire said. “Maybe you are trying to make your offer more attractive to the seller, so your buyer doesn’t ask for it, the same way they may choose to waive an inspection. But I think it is a lot cleaner to indicate what you and your buyer are doing about your compensation, especially if it is a multiple-offer situation. Because you don’t want to end up at the closing table and realize you and your buyer have not sorted out how you are getting paid.”Challenges and triumphsBrokers at the NHAR conference also weighed in on the newly mandated buyer representation agreements. New Hampshire was one of a handful of states that had already required these agreements, but brokers said most agents were not in the habit of getting these forms signed until a client was ready to submit an offer.For the most part, brokers said buyers are willing to sign these agreements. But Andy Smith, the broker-owner of Badger Peabody & Smith, said about 20% to 25% of prospective buyers are hesitant. Due to this, his firm has created a one-off showing agreement, which agents can use to show a single property to a buyer.“We did create a showing form for those one-off occasions when someone wants to just see one property, and one of our agents will show someone that one property and not expect a fee for the showing,“ Smith said. “If you want to go any further, then we’ll have to enter into a contract.”Despite the reluctance of some buyers, Smith feels that this change has been great for his agents.“I think, at some point, I am going to want to send attorney [Michael] Ketchmark a thank-you note, because my agents are getting much higher fees than when they were compensated by whatever the listing side decided was a fair fee,” Smith said. “The agents also weren’t talking to buyers before about what they are worth. Across the board, I am seeing higher buyer agency fees coming in, and buyers are happy to pay them because they see and understand the work their agent is doing for them.”Dean shares a similar view“Agents are getting better at communicating their value proposition,” he said. “Before, they would just take whatever was given to them, but now they have the opportunity to really describe what they are doing and their value. And we are being forced to have this conversation a lot earlier in the transaction and agents can really use it for their benefit.”Looking beyond the settlementBrokers also feel that these changes will help increase the overall level of professionalism in the industry.“I think some of the things that came out of this are good,” said Maggie Verani, the broker-owner of Berkshire Hathaway HomeServices Verani Realty. “We’ve been skirting the issues for a long time, and now you are either going to be a professional or you are going to get out of this business.”Although it is still too early to tell what the exact ramifications of the business practice changes will be and which best practices will emerge, real estate professionals in New Hampshire feel things are going fairly smoothly so far.“I’d like to applaud everybody,” said Chad Jacobson, the CEO of PrimeMLS. “This was a seismic change to the rules, and sure, there have been some outliers, but for the most part we’ve had tremendous compliance with these new rules very quickly.”Even though it is clear there will be some growing pains as industry players explore different models and ways of doing business, brokers are optimistic about the future.“I am grateful that we are past that July 15 date and the Aug. 17 date,” Cole said. ”And now we are where the rubber meets the road and everybody is sort of implementing all of the things that we’ve been discussing. And now we can find out what the real questions are.”