Follow-Up: Goldman Sachs Warns U.S. Housing Will Weaken Further, Sees Just 875,000 Single-Family Starts in 2027
NEW YORK — Goldman Sachs economist Ronnie Walker wrote in a client note that the U.S. housing market will likely weaken further before it stabilizes. Goldman expects U.S. residential investment to fall 2.5%, 4% and 1% over the next three quarters; single-family starts of just 875,000 in 2027 and existing-home sales of 3.9 million — 26% below pre-pandemic 2019. Walker attributes the persistently soft market to the "lock-in effect": homeowners with ultra-low mortgage rates are unwilling to sell and take on higher borrowing costs, while deteriorating affordability further drags on new construction.
The assessment comes as September housing data weakened across the board. The National Association of Realtors (NAR) reported Tuesday that its pending home sales index fell 7.3% month over month and 11.3% year over year, hitting the lowest level since records began in 2001 (reported by GSM on Oct. 20). Commerce Department data showed privately owned housing starts, seasonally adjusted and annualized, fell 5.2% in the month, versus a market consensus of just a 0.4% decline; building permits fell 0.2% against expectations of a 2% gain; single-family permits came in at just 845,000 units, down 4% from August to the lowest since 2023. Homebuilder confidence has sunk to its lowest in 14 years.
"Market conditions deteriorated in September as mortgage rates rose rapidly," said Lawrence Yun, NAR's chief economist. "Although job growth and rising incomes support housing demand, affordability is more heavily affected by changes in mortgage rates." According to Mortgage News Daily, the 30-year mortgage rate spent most of September above 7% and stood at about 7.6% at month's end — versus nearly 3% five years ago.
Published by GSM · USA (original Chinese edition)
Photo: 图：待售房屋标识（资料图）。照片：Rick Obst，CC BY 4.0，经Wikimedia Commons。Photo: A home-for-sale sign (file photo). Photo: Rick Obst, CC BY 4.0, via Wikimedia Commons.
- 2026-10-20NAR: Pending Home Sales Fell 7.3% in September as Index Hit Lowest Level Since 2001
- 2026-10-22Follow-Up: Goldman Sachs Warns U.S. Housing Will Weaken Further, Sees Just 875,000 Single-Family Starts in 2027This story
