The decline in new home construction could have a negative impact on homebuyers' purchasing decisions. With ongoing tight supply in the existing housing market, new construction serves as a crucial avenue to meet housing demand. However, with the decrease in new home construction, homebuyers' choices may be limited, leading to intensified competition and price increases.

The decline in new home construction could affect the vitality and development of the entire real estate market. The real estate industry is often seen as a barometer of the economy, with its healthy development having significant impacts on economic growth and employment. Therefore, the decline in new home construction could affect the development of related industries such as construction, finance, and real estate services, thereby exerting negative effects on the overall economy.

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Rising interest rates are also a significant factor contributing to the decline in new home construction. As interest rates increase, the borrowing costs for builders and homebuyers rise, limiting their ability to finance real estate projects and thus restraining the growth of new home construction. Additionally, the rising inflation rate reduces expectations for potential interest rate cuts by the Federal Reserve, leading to higher mortgage rates and further exacerbating the burden on homebuyers.

In this context, governments and relevant stakeholders may need to take a series of measures to mitigate the impact of the decline in new home construction. This could include providing more housing stimulus measures, adjusting policies to lower borrowing costs, increasing regulatory oversight of the real estate market, and promoting innovation and sustainable development in the real estate industry.