Homebuilders have also pointed to rising costs for materials and labour in their earnings calls, though so far they have had little impact on their margins. A sharp rise this year in U.S. Treasury yields reflects increasing worries about inflation and fears that the Federal Reserve will raise interest rates more aggressively than has been expected. The yield on the 10-year Treasury note is used as the benchmark for mortgage interest rates; higher rates increase mortgage costs for home buyers. Other factors also cast a cloud on the housing market. The stocks have given up much of those gains since then, even though homebuilders have continued to deliver upbeat results.

Source: The Hindu May 12, 2018 15:45 UTC