Home Depot Inc. has been waiting four years for a housing recovery that may remain out of reach, as Americans' mobility falls to a record low due to mortgage lock-in. The probability of changing residence over the next 12 months has dropped to 13.5%, according to Apollo's housing outlook, with roughly half of outstanding mortgages carrying rates below 4% and two-thirds below 5%, while new 30-year mortgages cost near 6.7%. Existing-home sales ran at an annualized 4.06 million in July, about 1.2 million below the pre-pandemic average, and Redfin estimates active homebuyers fell to a record-low 967,000. Home Depot's Q2 sales rose 5.7% to $47.9 billion and adjusted earnings increased 5.1%, but customer transactions fell 1%, and CFO Richard McPhail said housing turnover has "never been lower as a percentage of the housing stock" with "no sign of an inflection point." Polymarket traders now put roughly a 56% chance on the Fed raising rates by 25 basis points at its Sep. 16 meeting, suggesting mortgage relief may be further away.
The Home Depot IncPersistent mortgage lock-in reduces housing turnover and customer transactions, hurting demand for Home Depot's products.
Apollo Global Management LLC Class A