Building Inspection Services NAICS 541350

Sep 16, 2025 - Mortgage Rates Hit 11-Month Low

• Building inspectors could see demand improve if lower mortgage rates prompt an increase in home sales. The average 30-year mortgage rate was the lowest in nearly a year in the second week of September, increasing buying power for would-be homeowners, but headwinds for a housing recovery remain, according to The Wall Street Journal. The week of September 11, the weekly average for a 30-year fixed-rate mortgage was 6.35%, down significantly from 7% at the start of 2025, marking the lowest rate since October 2024. Industry insiders suggest the frozen housing market may begin to thaw when rates are consistently below 6%, a financial and psychological signpost for many. However, affordability remains a challenge as home prices are about 50% higher than in 2019. Insurance and property tax costs are also elevated. Signs of a slower labor market may also give some potential buyers pause.
• Mortgage applications for new home purchases increased 1% in August 2025 compared to the same month a year earlier, but were down 6% from July 2025, according to the Mortgage Bankers Association (MBA). The MBA’s seasonally adjusted estimate for new home sales in August was up 6% from July’s pace of 685,000 units. August marked the third consecutive rise in estimated new home sales. According to MBA Vice President and Deputy Chief Economist Joel Kan, housing inventory is rising, giving potential buyers more options while reducing upward pressure on housing prices.

• The Dodge Momentum Index (DMI) increased 7.5% in August 2025 to 301.4 (2000=100), up from the downwardly revised July reading of 279.9. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which has been shown to lead construction spending for nonresidential buildings by a full year. On a monthly basis, the commercial planning component improved by 8.7%, and institutional rose by 5.4%. For the commercial sector, growth in August was led by data centers, warehouses, hotels, service stations, and parking garages. Some institutional spending slowed, including education and healthcare, but remained in positive territory. Dodge’s associate director of forecasting, Sarah Martin, suggested that after several months of uncertainty, project owners and developers are beginning to move ahead, pricing in higher tariff-related costs. Nonresidential building construction planning is an indicator of future building inspection demand.
• High home prices and mortgage rates have priced many would-be homebuyers out of the market, creating robust pent-up demand that’s unlikely to be realized in the near term, according to The Wall Street Journal. In 2024, there were about 1.1 million first-time buyers, compared to an annual average of about 2.1 million over the last 20 years, according to the National Association of Realtors (NAR). To afford a median-priced new home today, a buyer would need an income of $127,000 compared to $79,000 for the same home in 2021, according to Harvard’s Joint Center for Housing Studies. Industry watchers suggest that many first-time buyers may remain stuck on the sidelines, absent a significant drop in mortgage rates or a recession that pushes down home values.