On The Tape with Danny Moses Ivy Zelman: "The Housing Survey Says..."
Nov 5, 2025
Ivy Zelman, founder of Zelman & Associates and renowned housing analyst, dives into the complexities of the housing market. She discusses the persistent affordability challenges and the impact of mortgage rate buy-downs on builders' margins. Ivy sheds light on the late innings of the new home absorption cycle, the varied demand across price points, and the implications of a K-shaped economy on younger buyers. She also warns about potential risks in manufactured housing and emphasizes the importance of proprietary survey data over traditional metrics.
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Affordability Still The Primary Brake
- Affordability remains the dominant constraint despite slightly better demand and lower rates.
- Builders face margin pressure and must push back on vendors while consumers hunt for deals.
Buydowns Drive A Vicious Builder Cycle
- Mortgage rate buydowns are extremely prevalent, especially at entry level, and act like a drug for builders.
- Buydowns force builders to spec homes, create completed inventory, then discount to move it, pressuring margins.
Spec Inventory Peaks; Cycle In Late Innings
- New-home spec inventories are at all-time highs and the cycle is likely in the late innings.
- Mid and higher price points perform better while many former COVID winners are now losers.
