Diana Olick, NBR, CNBC.com’s Posts

The nation’s homebuilders are feeling better about their business, as falling mortgage rates help more buyers afford homes.

They are still not, however, building enough homes to meet demand. That has less to do with buyer demand and more to do with concerns about the larger economy and trade.

Another sharp drop in mortgage rates sent even more homeowners to their lenders, hoping to save money on their monthly payments.

Homebuilders and buyers alike are pulling back, even as mortgage rates fall to multiyear lows. The housing market is simply too pricey, and consumers are starting to worry about the economy and their personal finances.

Homeowners rushed to take advantage of a sizable drop in mortgage interest rates last week, but potential buyers were unimpressed.

Affordability is driving more homebuyers away from big cities and toward smaller, unexpected markets. The suburbs of San Francisco and New York City used to be the most attractive, but now names like Omaha, Nebraska, and Rochester, New York, are replacing them.

Falling mortgage rates and strong employment drove consumer confidence in housing to a record high in July, according to a monthly index from Fannie Mae. At the same time, bidding wars eased thanks to lower demand in some of the hottest markets.

Escalating tensions over a trade war with China sent investors rushing to the relative safety of the bond market late last week. That pushed the yield on the 10-year Treasury, which mortgage rates loosely follow, down sharply.

Mortgage demand dropped to its lowest level since March, even though interest rates were much higher back then.

Home prices continue to gain, and while the gains were still shrinking in May on a national level, some markets are seeing stronger price appreciation yet again.

After rising the previous week, interest rates fell back again last week, but consumers were not enthused.

U.S. home sales fell more than expected in June as a persistent shortage of properties pushed prices to a record high, suggesting the housing market was struggling to regain its footing since hitting a soft patch last year.

The dollar volume of homes purchased by foreigners from April 2018 through March 2019 dropped 36% from the previous year, according to the National Association of Realtors.

The nation’s homebuilders should be ecstatic, given the supply of existing homes for sales and falling mortgage rates. Instead, they continue to be just cautiously optimistic, due to several roadblocks in their business.

Competition in the housing market finally began to cool this year, as listings multiplied and price gains moderated. Bidding wars became less frequent and spring sales perked up a bit. Well, forget that. The heat is on yet again.