The spring home-building season has begun on a challenging note. Recent data from the Census Bureau shows that housing starts, which track new home construction, fell by 11.4% in March compared to February. This decline represents the steepest drop in a year.
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Persistently high home prices and mortgage rates have kept many potential buyers from entering the market for months. As a result, builders are resorting to offering incentives and discounts in an effort to secure contracts. This reduced demand has discouraged builders from initiating new projects.
Single-family home construction saw the most significant slowdown, experiencing a 14.2% decline from February and a 9.7% drop compared to the same time last year. In the Southeast, where 56% of single-family homes were started in March, volumes fell 17.6% m/m. While the prices of new homes have slightly decreased from their peak as builders offer mortgage-rate buydowns and other incentives to reduce their inventory, the current levels of newly built homes remain the highest they have been in 16 years.
Additionally, a monthly survey conducted by the National Association of Home Builders (NAHB) revealed that builders’ expectations for single-family home sales in the next six months have dropped by four points in April.
Load-to-Truck Ratio
After dropping for most of April, flatbed load post volumes reversed course last week, increasing by 5%. Volumes are 23% higher than last year. Last week’s flatbed load-to-truck ratio (LTR) ended at 35.37, up 13% w/w.
Spot rates
Flatbed spot rates have been mostly flat throughout April, although available capacity tightened slightly last week, increasing by almost a penny-per-mile to just under $2.17/mile. Compared to last year, the flatbed 7-day rolling average is $0.18/mile higher and for the first time this year, are now $0.03/mile higher than 2023.
