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U.S. Homebuilders Fall as Analysts Warn of a ‘Rocky’ Path Ahead

  • Rising prices, mortgage rates hurting demand in costly areas
  • Several companies downgraded on reduced earnings expectations
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Alan Ruskin, global co-head of FX research at Deutsche Bank, says the housing market doesn’t look great.Daybreak: Americas." (Source: Bloomberg)

Homebuilders in the U.S. fell after a report of slowing housing starts and a flurry of analyst warnings signaled that the industry’s slowdown will continue in the coming year.

Rising mortgage rates, along with years of steady price increases, have cut into affordability for buyers, especially in expensive coastal markets where demand is slowing. Homes are also getting costlier to build, and it’s becoming more difficult for companies to pass the increase on to customers.