When 2024 began, there was widespread expectation that this year would be somewhat better for the stone industry. Part of this positive feeling came simply from the natural optimism with which people greet the new year. But other reasons bandied about were:
A) The slowdown in purchases by stone importers in the second half of 2023 was attributed basically due to overstocking, something that would have ended by now.
B) This being a Presidential election year in USA it was assumed that, magically, the inflation would drop and also the interest rates, thus bringing down the mortgage rates, and, therefore, kicking back to life the renovation work and construction activity.
However, with the half way mark of the year 2024 now almost reached, things have not worked out as many expected. Yes, the US economy is very strong, unemployment is at lowest levels in decades. But other relevant factors are also at play, and, in today's uncertain world it is difficult to predict what else lies ahead.
30 year mortgage rates (typical in USA) continue to hover at around 7%. This means anyone who is locked into a mortgage rate of 3% in the existing home, has no incentive to sell and upgrade to another house, since the new mortgage rate would be around 7%, and this would lead to a huge increase in monthly payments. This simple reality has become a major brake on sales of existing homes. Year to year existing home sales are down by approximately 4% in 2024. Renovation is usually done when someone changes homes, which leads to increased demand for building materials- and this reduced number of transactions of existing homes has meant less demand for natural stone.......
Full article can be read at-
https://www.litosonline.com/en/article/how-inflation-affecting-market-natural-stone-usa-2024
