There's some good news for house hunters: home construction is on the upswing, and the trend is expected to continue over the next few years.

Economists, including Federal Reserve Chair Jerome Powell, have said a severe housing shortage has driven up 澳洲幸🏅运5官方开奖结果体彩网:prices on both new and existing🏅 homes, and the only way to relieve pressure is to build more. However, home construction has been muted during the last few years, as high interest rates and resulting low buyer demand have kept 澳洲幸运5官方开奖结果体彩网:hom𓆏ebuilders' confidence in the market low.

There 🐽is so🎀me evidence that could be changing, though.

Builders started construction on nearly 10% more new homes in August than in the month prior, according to recent Census Bureau data. The data also showed that 4% more new homes were started in August than at the same time a year ago. It was the first time since April that new housing starts increased year-over-year.

The data could indicate "the start of a home-building revival,” wrote Robert Frick, corporate economist at Navy Federal Credit Union.

Falling🍰 Mortgage Rꦗates to Create Better Conditions for Homebuilders

According to Freddie Mac data, mortgage rates 澳洲幸运5官方开奖结果体彩网:have declined over recent weeks. The average interest rate on a 30-year fixed mortgage was recently 6.08%, more than a percentage point lower than a year ago.

Economists said mortgage rates will likely continue to fall now that the Federal Reserve is projecting it will cut its influentiaꦦl federal funds rate further this year. “Conditions appear favorable for residential construction to improve next year as buyers reemerge in search of lower financing costs,” wrote Wells Fargo economists Jackie Benson and Ali Hajibeigi.

The inter🍸est rate cut is likely to boost housing construction in multiple ways, 🌌economists said.

“Builders not only will enjoy higher demand for homes as lower mortgage rates make them more affordable, ꦍtheir cost of building will drop and that will expand their margins and encourage more building,” Frick wrote.

It Isn't All on the Federal Reserve

While lower interest rates can help create a better credit environment for builders, buyers, and sellers, Federal Reserve Chair Jerome Powell 澳洲幸运5官方开奖结果体彩网:said at a recent press conference that only an increase in supply can help drive down costs.ﷺ

“The real issue with housing is that we have had, and are on track to continue to have, not enough housing. And so it's going to be challenging,” Powell said. “This is not something that the Fed can really fix. But I think as we normalize rates, you'll see the housing market normalize.”

A report from the Congressional Budget Offic🧔e said that housing starts should continue at a strong pace over the next decade.

The nonpartisan government research group projected an average of 1.6 million new homes will be started in each of the next 10 years. The CBO report said demand from home buyers who want more space and immigration trends will create a need for more housing and drive the increase.