For the second month in a row, homebuilder confidence tumbled amid broad-based declines across sales, expectations and buyer traffic (down 4 to 56 and b 60 print expected) as hope begins to fall toward to the housing market's reality. In addition, National Association of Home Builders (NAHB) six-month sales outlook dropped to the lowest since March 2016 while a measure of current sales for single-family homes decreased to a three-year low. “We are hearing from builders that consumer demand exists, but that customers are hesitating to make a purchase because of rising home costs,” said NAHB Chairman Randy Noel. “However, recent declines in mortgage interest rates should help move the market forward in early 2019.” Randy is of course paid to talk up his book, but we do not see the housing market recovering in 2019, but instead the continued decline until this bubble finally bursts.

Looking at the three-month moving averages for regional Housing Market Index (HMI) scores, the Midwest dropped two points to 55; the West and South both fell three points to 68 and 65, respectively; and the Northeast registered an eight-point drop to 50. Regional, Denver is still doing well compared to the rest of the country, but what that should tell us is the housing bubble bursting impact will lag hitting in Denver. So if you see continued steep declines across the country, hold off on buying a home because those prices will be coming to Denver neighborhood near you.