Buyers are still shopping for newly built homes in Metro Detroit, but fewer are moving quickly to sign contracts as higher borrowing costs pressure household budgets.

That’s what Darian Neubecker, president of Bloomfield Hills-based Robertson Brothers Homes, is seeing across the company’s communities. While potential buyers continue to research the homebuilding process, website traffic and in-person visits have declined from a year ago.

“There are certainly folks doing homework on buying,” Neubecker said. “I think as soon as we see relief on interest rates, we’ll see sales activity pick back up.”

Neubecker attributed the slowdown to temporary factors, such as higher mortgage rates amid geopolitical factors, including the U.S.-Israel war with Iran. And those factors are impacting new home activity.  

Builders pulled 931 single-family permits across Macomb, Monroe, Oakland, St. Clair and Wayne counties through April, marking the second-slowest start to a year since 2012, according to the Home Builders Association of Southeastern Michigan.

In April, builders pulled 310 single-family permits across the five-county region, down 18.4% from 380 permits a year earlier. The decline was led by Wayne County, where permits fell 30.2%, while Oakland County permits dropped 16.5% and Macomb County permits fell 12.1%.

One bright spot: April activity was up slightly from March, when builders pulled 302 permits. While the need for housing remains strong, higher mortgage rates and home prices have reduced affordability and caused some prospective buyers to delay purchasing decisions, economists say.

Mortgage rates remain elevated, with a 30-year fixed loan averaging around 6.5% in recent Freddie Mac data.

“Everybody’s basically waiting to see what happens to mortgage rates, and they have been like on a seesaw,” said Daniil Manaenkov, U.S. forecasting specialist for the University of Michigan’s Department of Economics. “So you would get some improvements, it would start edging down, but then something would happen, and rates would edge back up.”

Manaenkov said housing activity today more closely resembles pre-pandemic levels than the market after COVID-19, when low borrowing costs fueled demand and construction.

The market has softened, though it’s relatively stable rather than severely depressed, Manaenkov said.

Market’s ‘one-two punch’

One recent morning, Neubecker stood inside a two-bedroom townhome under construction at the Scripps District development along Trumbull Avenue in Detroit’s Woodbridge neighborhood.

As crews worked throughout the partially finished development, he spoke of the property’s features and the state of the homebuilding market. The project includes 65 two-bedroom townhomes priced from the upper $300,000s. Construction began about two years ago and is expected to be completed in 2027.

Neubecker said it has been one of Robertson Brothers Homes’ strongest-selling communities, outperforming the company’s other southeast Michigan developments during its early months on the market.

The company has about 100 homes under construction across southeast Michigan, and he estimates sales are down between 15-20%. Some of the other communities in Metro Detroit have seen a slowdown in sales, including developments in Troy and Lyon Township.

He said recent softness in buyer demand is showing up in early-stage sales data and could mean lower permit activity in the near future, Neubecker said: “Sales is always a three- to six-month leading indicator of permit activity.”

He expects the slowdown to be temporary. “Long term, not worried; medium term, not worried,” he said. “Short term, I would classify it as a nuisance more than anything.”

Vito Castellana, owner of V.I.P Homes & Development, said the most significant slowdown is occurring at the entry-level segment of the market, where affordability is the toughest.

In Burton near Flint, he said the company is building 1,500-square-foot single-story condos priced in the high $200,000s and 2,000-square-foot two-story colonials priced in the low $300,000s. Among the company’s other projects are seven single-family homes in Sterling Heights, ranging from 2,600 square feet to 4,000 square feet with three-car garages priced in the $800,000s.

Castellana said many potential buyers are pausing due to current mortgage rates and the desire not to lose the low rates they have on their present homes.

Two Detroit sisters, including one who was nine months pregnant at the time, are accused of stabbing a worker at a Detroit chicken restaurant during a wrong-order dispute, with prosecutors alleging one sister stabbed the employee and that the women attempted to throw hot grease, pans and other items at her.

Brianna and Kierianna Long now face several charges in connection with the May 30 incident, including assault with intent to murder, assault with intent to do great bodily harm less than murder and assault with a dangerous weapon, according to local reports. Both women have pleaded not guilty.

The two sisters entered the restaurant, ran behind the counter and attacked the 23-year-old employee after they were given a wrong order, prosecutors said, according to the outlet.

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The sisters threw items at the employee, chased her through the restaurant, hit her with pots and pans, attempted to throw hot grease on her head and threatened to kill her, according to prosecutors.

“I’m going to kill you,” one of the sisters allegedly said during the encounter, WDIV reported.

The employee was then stabbed in the stomach with a knife by Kierianna, prosecutors said.

The injured employee had to be taken to the hospital for surgery after she ran out of the restaurant and hid inside a stranger’s vehicle while calling for help.

Brianna, 29, and Kierianna, 26, fled the scene after the attack but were eventually arrested by police.

Defense attorneys attempted to dispute the allegations in court, arguing that the employee triggered the assault by saying that she did not “give a f—” about the food order error before throwing items including knives first during the incident.

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Brianna, who was 9 months pregnant at the time of the incident, gave birth four days before her arraignment, her attorney said, ClickonDetroit reported. She pleaded with the judge by saying that she was innocent and had a 4-day-old baby at home.

Both sisters pleaded not guilty to the charges. Brianna was held on a $25,000 cash bond and Kierianna was held on a $100,000 cash bond.