Fitch: Solid Spring Positions U.S. Homebuilders For Strong 2H'15

NEW YORK--(BUSINESS WIRE)-- Link to Fitch Ratings' Report: U.S. Homebuilding/Construction: The Chalk Line

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867832

A solid spring selling season has the U.S. homebuilding sector in line for a continued strong push in the second half of this year, according to Fitch Ratings in the latest edition of the 'Chalk Line'.

Key economic and housing metrics were broadly positive, according to Managing Director and lead homebuilding analyst Robert Curran. 'A sound economy, pent-up demand, attractive affordability and a moderate, steady easing of credit standards helped pave the way for a good spring season and should help strengthen results for the year,' said Curran.

In 2015, single-family starts should expand about 12.5% and multifamily volume should gain about 7%. Fitch expects new home sales to improve about 20%, while existing home sales stand to rise approximately 4%. The upcycle for housing should continue in 2016. Single-family starts should improve 15% as multifamily volume gains 7%. New and existing home sales should increase 18% and 5%, respectively.

Fitch expects stable ratings for most issuers within the homebuilding sector during 2015, reflecting a continued, moderate cyclical improvement in overall construction activity. However, there is potential for a few positive outlooks and/or upgrades.

Fitch will provide a brief recap of the first-quarter 2015 (1Q'15) and comment on the expectations for the 2Q'15 and calendar years 2015 and 2016 during a teleconference to be held Wednesday, July 23, at 2:00 p.m. ET (separate press release to follow).

Fitch's latest 'U.S. Homebuilding: The Chalk Line - Quarterly Update: Summer 2015' includes the following key updates and new features:

--Homebuilders' quarterly growth trends and margin statistics for 1Q'15, excluding the impact of non-recurring, non-cash real estate charges, are provided.

--Liquidity analyses are updated and historical liquidity profiles are presented for perspective.

--Recovery ratings are detailed for five single B or lower rated homebuilding credits.

--Past and present oil prices and their effect on the Houston and Texas economies are discussed.

--A new study by the National Realtors Association on international home buyers is profiled.

--Annual characteristics of new housing for 2014, including lot sizes, floor area per home, and exposure to homeowners associations, is highlighted.

--Annualized trends in housing unit growth are provided.

--Average and median price per sq. ft. for new one family homes sold by location for 2014 and prior years are referenced.

--Data relating to 2014 Builder 100 statistics and rankings are noted.

--Updated housing regulator actions are discussed.

--Various foreclosure statistics and related data are updated.

--There are also updated comments on the Fed and interest rates, metropolitan home prices, housing related regulations, owning versus renting, cash sales, national home pricing trends, jumbo loans, lumber and other materials prices, incremental sources of demand, labor costs, underwriting standards, underwater homes, demographics, Fannie Mae/Freddie Mac, the FHFA, FHA, HAMP, HARP, and demographics.

--Fitch's economic and construction forecasts for 2015 have been updated and projections for 2016 are introduced.

The report is available at 'www.fitchratings.com' under 'Latest Research' or by clicking on the above link.

Additional information is available at 'www.fitchratings.com'

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View source version on businesswire.com: http://www.businesswire.com/news/home/20150721006308/en/

Fitch Ratings
Robert P. Curran
Managing Director
+1-212-908-0515
Fitch Ratings, Inc., 33 Whitehall Street, New York, NY 10004
or
Robert Rulla
Director
+1-312-606-2311
or
Monica Delarosa
Associate Director
+1-212-908-0525
or
Media Relations:
Sandro Scenga, +1 212-908-0278
[email protected]

Source: Fitch Ratings

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