5 Ways Builders Can Prepare for the Aftermath of Rising Interest Rates

As the Federal Reserve prepares to raise interest rates over the next 18 months, home builders are making big changes to capitalize on a potential market slowdown. Buyer demand is expected to soften in the wake of elevated housing prices, so rather than amping up spec home construction, builders should reduce their project loads to avoid lost margins on finished homes, Carrie Roeger of Shinn Consulting reports.

Focusing on the buyer and adapting to new demand can help builders stay on track and meet the needs of a changing clientele, while adjusting marketing budgets can keep new consumers interested and engaged even in the midst of an affordability crisis.

Rising interest rates have historically softened new home sales. The coming increases will do the same this time around. Though the need for housing units is still strong, the willingness and ability to purchase will be eroded over the next 18 months. Change is coming, and no builder should be unprepared.

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