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The chief executive of one of the nation’s leading luxury home building companies is complaining that the housing market is seriously underperforming, despite conditions that should contribute to a new wave of sales vibrancy.
In an appearance today on CNBC’s Squawk Box, Toll Brothers CEO defined current housing conditions as “healthy” and insisted that historically low interest rates and an improving economy should contribute to a healthy housing market. But he stated the post-recession housing market is in the “fourth or fifth inning,” with little evidence that activity will suddenly improve.
“Four years in, I would think the housing market would be further along,” he said. “I think it means we're going to have a longer, slower recovery.”
Yearly added that the anticipated rate hike by the Federal Reserve should not have a negative impact on housing.
“We don't worry about the Fed raising rates as long as it's done intelligently and slowly," Yearley said. “I'll take a 4.5 percent rate in a better economy any day.”
Yearly also challenged recent industry data that suggested Millennials prefer an urban residential setting.
“Certainly more and more people are living in cities,” he continued. “But [in] the American Dream when you settle down and your kid hits kindergarten, most people are moving to the ’burbs.”