Tight Supply Fuels Demand for Newly Built Homes

Recent fall in mortgage rates relieves a source of industry pressure

Mortgage rates have fallen from the 20-year highs they hit in autumn. Photo: Angela Owens/The Wall Street Journal

Home builders are enjoying stronger-than-expected business this spring, capitalizing on the recent fall in mortgage rates and the shortage of existing homes for sale.

Last year’s rapid rise in mortgage rates made home purchasing far more expensive for most buyers, slowing home sales and pressuring the home-building industry. Home builders pulled back on land acquisition and new construction.

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