{"id":1500,"date":"2025-07-16T01:12:23","date_gmt":"2025-07-16T01:12:23","guid":{"rendered":"https:\/\/lightingnewsnow.com\/?p=1500"},"modified":"2025-07-16T11:54:00","modified_gmt":"2025-07-16T11:54:00","slug":"zondas-q3-housing-forecast","status":"publish","type":"post","link":"https:\/\/lightingnewsnow.com\/?p=1500","title":{"rendered":"Zonda\u2019s Q3 Housing Forecast Indicates Softer Market Than Expected"},"content":{"rendered":"\n

In the first two quarters of this year, hopes remained high that the tariffs would reach an even keel, the Federal Reserve would whittle down the interest rate, and consumers would resume their homebuying fervor.  <\/p>\n\n\n\n

None of that happened, however, according to Zonda Research<\/a>\u2019s Q3 Housing Forecast, which was released yesterday and sponsored by Westwood Insurance Agency. According to Ali Wolf, chief economist for Zonda, new homes sales (using data compiled in May) confirm that the market \u201chas not lived up to expectations.\u201d New home sales are down, compared to the same time last year and \u2013 more importantly \u2013 also coming in lower than 2023.  Builders nationwide described their market as \u201cbumpy,\u201d \u201cchallenging,\u201d \u201cunpredictable,\u201d and \u201cslower than expected.\u201d<\/p>\n\n\n\n

To provide context for those numbers, Wolf\u00a0 said Zonda\u2019s Market Ranking (ZMR) takes into account sales adjusted for supply and seasonality. Using that analysis, the market is reported as average nationwide. \u201cThis means the market is slower than what we\u2019re used to, but if you look at this over a 10-year timeframe and time of year, it\u2019s not abnormally<\/em> slow,\u201d she stated. ZMR does not account for what it takes to sell a home, such as incentives like buy-downs. <\/p>\n\n\n\n

There are markets that are significantly under-performing (for example, San Diego, Seattle, and Denver) and slightly under-performing (including Dallas, Portland, Sacramento, Orlando)\u00a0despite the fact that builders are offering incentives and trying to work with consumers. \u201cThose markets are much more alarming than markets in parts of the Midwest (Chicago, Cincinnati, and Indianapolis) or in South Carolina (Greenville, Columbia, Charleston, and Mrytle Beach), where buyers are responding favorably to the kind of discounts builders are offering. Since 2022, builders have been offering some kind of incentive, whether it is a financial incentive, design credit, or overall flex dollars,\u201d Wolf said. \u201cWhile there is nothing new about incentives, right now we\u2019re seeing that they are more pervasive.\u201d<\/p>\n\n\n\n

The change, however, is the rise of what Wolf calls \u201cIncentive Plus,\u201d wherein consumers want even more incentives. In every top market, there is a noticeable trend for homes\u2019 selling prices to now be below what was considered peak selling price not that long ago.<\/p>\n\n\n\n

Interestingly, none of the builders surveyed by Zonda have raised prices in the past month, even in the face of rising material costs. \u201cOur research is split between builders holding \u00a0prices flat or lowering them,\u201d she noted. The new home market\u2019s reduced prices could also reflect a \u201cmix shift,\u201d where new homes might be smaller in size or built further away from a desirable area. \u00a0\u201cThere is some evidence that mix shift is playing into the price changes,\u201d she said.<\/p>\n\n\n\n

Roughly 80% of builders contacted by Zonda say that demand is slower; 30% say demand is slower, but not worrisome; and 50% say demand is slower and causing concern. \u00a0<\/p>\n\n\n\n

\u201cToday we might have consumers who want to buy a home, or need to buy a home, but there is no urgency,\u201d Wolf recounted. Some of the macro trends influencing consumers to wait on the sidelines are continued uncertainty over tariffs, inflation, the economy, and more recently job security. \u201cWe could get into an environment where inflation is going up, the economy going down \u2013 also known as stagflation \u2013 and the Fed is going to find themselves between a rock and a hard place,\u201d she commented. Even if the Fed decides to cut interest rates, \u201cthat still doesn\u2019t guarantee that our industry benefits from lower mortgage rates because there could be intricacies in the bond market that could keep interest rates high,\u201d Wolf explained.  <\/p>\n\n\n\n

Another reason for the lack of urgency has to do with home supply catching up with demand. \u201cThere are more choices now,\u201d she said. Less than two years ago, when a home went on the market, buyers had to make an offer quickly.  While there is a rise in the number of active home listings overall, Wolf noted that nationally we are still below 2019 levels. The majority of top markets today have more supply than they did in 2019. Another complication is that buyers wishing to purchase a new home are finding that it\u2019s taking longer to sell their existing homes in order to complete their purchase.<\/p>\n\n\n\n

Overall, Zonda\u2019s most recent research points to builders, as well as homebuyers, being more cautious in their plans. Zonda results indicate single family home starts will be down by 12% this year. Wolf cautions, \u201cWhen you see single family housing starts that are down, that is traditionally a leading indicator to a broader pull-back in the economy. That\u2019s partly because, as you think about our industry, for every home we build, we create jobs \u2014 jobs when we construct the home, sell the home, and after someone moves into the home. So we know that there could be broader impacts that we are watching closely as we move toward the end of this year.\u201d<\/p>\n\n\n\n

Related articles<\/strong><\/p>\n\n\n\n

Homebuilding Slows, Yet There Are Bright Spots for Some Showrooms<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

In the first two quarters of this year, hopes remained high that the tariffs would reach an even keel, the Federal Reserve would whittle down the interest rate, and consumers would resume their homebuying fervor.   None of that happened, however, according to Zonda Research\u2019s Q3 Housing Forecast, which was released yesterday and sponsored by…<\/p>\n","protected":false},"author":2,"featured_media":1501,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":115,"footnotes":""},"categories":[11,391],"tags":[452,453,454,280],"class_list":["post-1500","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","category-featured","tag-home-building","tag-home-starts","tag-housing-forecast","tag-zonda"],"yoast_head":"\nZonda\u2019s Q3 Housing Forecast Indicates Softer Market Than Expected - Lighting News Now<\/title>\n<meta name=\"description\" content=\"According to Zonda Research\u2019s Q3 Housing Forecast, the single family home starts will remain softer than expected.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/lightingnewsnow.com\/?p=1500\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Zonda\u2019s Q3 Housing Forecast Indicates Softer Market Than Expected - 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