MetroIntelligence Economic Update by P. DUFFY
August consumer sentiment index up 7.0 percent from July but down 21.6 percent year-on-year
Consumer sentiment moved up very slightly in August to about 5 index points above the all-time low reached in June. All components of the expectations index improved this month, particularly among low and middle income consumers for whom inflation is particularly salient. The year-ahead economic outlook rose substantially to just above its average reading from the second quarter 2022, while the two other expectations index components remain at or below their second quarter averages.
Credit for builders less available, costs more
During the second quarter of 2022, credit became both tighter and more costly on loans for Acquisition, Development & Construction (AD&C). The average effective rate (based on rate of return to the lender over the assumed life of the loan taking both the contract interest rate and initial fee into account) increased substantially from the prior quarter on all four categories of loans tracked in the AD&C Survey: from 6.32 percent to 8.19 percent on loans for land acquisition, from 7.85 to 9.55 percent on loans for land development, from 7.38 to 8.48 percent on loans for speculative single-family construction, and from 7.90 to 8.63 percent on loans for pre-sold single-family construction.
https://eyeonhousing.org/2022/08/credit-for-builders-less-available-costs-more/
