diana olick has that story from jesup,ry nd, tonight. >> reporter: demand for home renovations like this one is soaring, and s are the costs to do it thanks to a new round of tariffs onhinese goods. >> it might end up being that this is sort of in the short term the newmal for pricing. >> reporter: contractor justin sullivan said the costs are going up so much, he has to do something he's never done in over a decade in business. >> clients and contracts are having to set contracts with escalation clauses for projects that are beingul sch for 6 months largely because we're not sure how far prices go north.g to >> reporter: the latest round of tariffs hits about $10 billion worth of chinese products exclusive to home building and remodeling according to the national association of home builders. a 25% tariff would be equivalent to a $2.5 billionax increase on the industry. tariffs have already hit lumber, steel and aluminum. the n round adds everything from wall and floor board to light fixtures, cabinets, heating and cooling equipment, even the tile forbath rooms and cksplashes. david ben

for nightly businessre rt, i'm diana olick in washington. >> coming up, feeling the sting of tariffs.ports revenues represent about a quarter of american gdp and tariffs on theg table, shipp volumes are down.'v e got the story coming uinon "nightly bs report." ♪ ♪ >>> chinaays it's ready to retaliate if the u.s. imposes fresh00 tariffs on billion worth of chinese goods. today marks the end of the on-calledltation period for those new tariffs meaning they could be announced as early as this week. the new taxesould be as high as 25% on some products. the national retail federation and 150 other organizations urged the u.s.de t representative today to avoid further trade escalation with china. one place tariffs are already being felt, the nation's port. jackie de angeles explains from new orleans. >>> about a quarter of u.s. gdp is tied to trade. that includes the ports, railroads, pipelines, farmers and truckers who depend on it. he at the port of new orleans, imports represent more than $50 billio tariffs are making a dent. in the first six months of the year,import volumes as a result

diana olick is in scott's dale, arizona. >> arizona bed taylor morrison homes is the seventh largest publicly traded home builder by revenue. and the ceo sheryl palmer is the first and only one of her kind in tho ranks, a female ceo. that this wastain an intentional path for me. but it's one that felt right fob ously -- i've been in this industry for 20 years. color blind, i'm depender blind. they might notice i'm the single female at the table. but f mehis is just what i do. all the old jokes about there is no line tohe ladies -- those are all true. but it -- doesn't change me. i always said in business, the day i have to change who i am is the day i'll stop. >> palmer started in home building first at poulty homes then taylor morrison. they she took the company public in 2012. >> you're at the table. >> um-hum. >>he other publicly traded ceos have you you ever felt minimized and if so how. >> for sure. early days i think if i were to share a view i think it almost was gloss over. i had to continue and i knew that -- i knew that my position wsws my v on the business were right. i wo

for nightly business report, i'm diana olick into washi >> let's talk a little bit more about buyingoday'oung market with skylar olson. senior economist. good to have you with us. >> what do you say? should i rent or buy? > i'm going to have to say it depend it depends a lot on primarily right?hings, you personally, it depends on how long you're going to staythn property, whether or not that financial decision pays off. we have an inition that you'll be there a short period of time, rent, of cour, very,ery long, buy, of course, but where the tradeoff is, nationally we still estimate that that balance and turning point is still under three years. so in terms of the personal decision, that is how good your credit ise because as mentioned before the mortgage big differenceg, with how expensive it is to own that home and lastly, you've got to have that financial plan for what you're going to do with your savings is not putting a home a lot of americans when they make that choice, they actually don't invest as readily in stock markets and that's an important part of that tradeoff if you'r

diana olick has more. >> there are finally more of these compared to last year. august saw the first annual increase in the supply of homes for sale in over three years. but that good news is tempered with a tough new reality. mortgage rates are rising again, knocking at the door of 5% on the 30-year fixed. while that may not seem historically high to older generations it's the first time most millennial home buyers have seen it. the real tors chief economist lauren yoon says not osy d that price younger buyers out but keeps current home owners i plac >> 14% of realtors are indicating that when they are speaking with clients that clients do not want to list properties because they like the current low mortgage rates. >> and that's exas baiting thea ady critical supply shortage, especially on the low end of the market where housing is most in demand. that was clear in the august figures, sales down 12% for homes priced under $100,000. but up 12% for those priced over io mi there are far more million dollar homes available than cheap homes. >> we have a good econom

ten years ago fannie mae and freddie mac were bleeding goverm out an too out and took them over diana olicks at what the future holds for them. >> reporter: if fannie and freddie had gone under, the housing recovery would look nothing like it does today >> everything worked the housing crisis that team say could last for decades lasted several years and home kriss regainr prices regained value. if anybody said they saw this in 2008 or 2009, they're kidding themselves it's been remarkable. >> reporter: under government conservatorship fannie and freddie drew money in the treasury but were required to pay profits back to the golf e government fannie and freddie drew 194$1944 billion from the treasury. so far they paid 279.7 billion back a net profit of 88$88.3 billion and they continue to pay some argue that profit is part of why congress and the administration have done very little beyond offering proposals for reforming the mortgage market and the market today is nothing like it was a decade ago when lenders shut the doors to anyone but the most pristine borrowers. >> it was probably the mo

diana olick is here and is following the money.st courtney reagan with a look at what's coming up >>> trouble secured, the sex fili s.e.c. filing against elon musk. we'll debate it and see. he was formerly on the fbi's most wanted list for hacking and now he's helping companies fight back against the rise of hackers so what advice does he have? and former cleveland browns player joe thomas, the future of the league, colin kaepernick and his new venture off the field. that and much more coming up on "power lunch." i hope you're hungry - i love my grandma. - anncr: as you grow older, your brain naturally begins to change which may cause trouble with recall. - learning from him is great... when i can keep up! - anncr: thankfully, prevagen helps your brain and improves memory. - dad's got all the answers. - anncr: prevagen is now the number-one-selling brain health supplement in drug stores nationwide. - she outsmarts me every single time. - checkmate! you wanna play again? - anncr: prevagen. healthier brain. better life. at fidelity,

diana olick in washington. th to fred glik to talk more about the state o housing market, the ceo of the real kerage and mortgage b company, arriva.com out in california. good to see you welcome back. >> l., b thanks for something me. >> we have far more renter than a decade ago. is that good or bad forl the r estate market? and how long do you expect that to continue? >>well, it's actually, i'll say, goo and why i say that is because hopefully peoave will beg up and eventually buying or finally csidering buying in a few years from now. because right now people's mentality is not what it used to be, where everyone said i have to own a house. that's the american dream. it's just not that way anymore. >> what about the housing market in general? we have gone through this very difficult time. the banks have tightened up their lending requirements. that wouldeem to be a good thing. do you feel good about the market as it stands now? >>yes, sue. the story is that, yes, it is difficult, quote unquote, to get to mortg

diana olick explains. >> 31-year-old jessica evans lives in washington, d.c. with lucy and kasper.m her fur children. >> i want to have kids one day i'm not at that point in my life and a lot of millennials are in at same boat, but you still enjoy having something to take care of. >> and taking care of lucy ande kasper buying this house. >> i love living in the downtown area in and it was great. it was very convenient and i didn't have house work and theo thing that was missing was my dog's happiness. >> and she is far from alone. 73% of millennials currently own a pet according to the arican pet products association. that's more than any other demographic and ain who 89% of millennials who bought homes so far this year own a pet according to realtor.com. that has millennials putting their pets' nee front and center in real estate decisions. 79% of pet-owning homebuyers who closed this year said they would pass up an otherwise perfect home if it didn't meet the needs of their pets according to retor.com's survey. jessica knows this firsthand because she's also a real estate agent.

let's ask diana olick. diana, what did you think of the new home sales data? >> they're good.. not the greatest we were expecting. you're up 1.9% in pricesing which a difficult thing because we're looking at people who are trying to get on having affordability issues you have mortgage rates in august we're 75 basis points higher than a year ago so to see prices up 1.9% median price of a new home sale, we were hoping to see that moderate. remember, these are signed contracts to buy newly built homes in august so it's people out shopping not the closing in existing home sales but also seeing inventories of new homes up to a 6.1 month supply that's the highest of the year so you have a lot of available supply but the sales numbers okay they're okay not saying they're not but they could be stronger given the demand it's that affordability problem we continue to run into housing which is getting worse and worse. back to you guys. >> diana, good afternoon diana olick. >>> we're a few moments from hearing from the president once again he e's chairing the u.n. security council, a brie

diana olick joins us from washington hi, diana. >> hi, melissa the signed contracts to buy existing homes fell 1.8% down 2.3% year over year that was the fourth monthly decline in the last five months and the slowest sales pace since january. sales have been hampered all year by a severe shortage of listings supplies did rise slightly in august but not so much at the entry level where most of the demand is. a recent survey from the realtors showed a record number of sellers saying they believe now is a good time to sell we'll see if that translates into more listings this fall a huge sales decline in the west down 5.9% in the month and 11.3% compared with august of 2017 prices are highest in the west and are still higher than a year ago but the gains are shrinking. prices usually lag sales pending home sales were down everywhere else except slightly up year over year in the south if you missed all of these numbers they are up now on cnbc.com back to you. >> di, thank you very much the fed's rate hike plan a major factor impacting the housing economy. the decision not sitting terribly well

that turned out to be a profitable move for uncle system diana olick has more details on those two enterprises that ten years later remain under government control >> fannie mae and freddie mac don't make mortgages, they make it possible for lenders to make mortgages by buying their loans and packaging them into guaranteed securities that investors buy. that's how lenders get money to people who want to buy homes a decade ago fannie and freddie owned or backed 40% of mortgages outstanding. when the housing market crashed, the two began to bleed cash. so the u.s. government bailed them out and then took them over and putting them into so-called conservatorship. it was said to be temporary, but they are still there today. >> what the government did actually worked. fannie and freddie kept backing loans. people kept buying mbs and fha expanded like it was designed to do everything worked and the housing crisis that people said could last for decades lasted several years and home prices quickly started to regain value. >> under conservatorship, fannie and freddie drew money from treasury, but were

. >> so diana olick from reality check on cnbc says that renters can still cumulate weather.investing in a house, invest in a stock market until home prices settle. >>> coming up, the 55 and over crew lost their best moves this weekend. a sneak peek at the contenders for the brand-new dance team. a continued shortage of drivers reportedly has >>> new for you this morning, a continued shortage of drivers reportedly has muni turning to new measures to avoid further bus delays. >> the agency is now lowering its training standards in an effort to get more drivers into service. according to the examiner, sf muni officials are reducing the amount of training hours needed to become an operator. number of hours spent with certified trainers has been cut, as well. ever since schools returned to session last month, muni has been overwhelmed with the amount of riders on buses and trains. >>> in the week ahead, experts will take another look at the cracked window at san francisco's millennial tower. the next few days a worker will rappel down the side of the building to do another evalua

. >>> let's turn to find some opportunity and talk real estate diana olick is here and has found maybeand it might have to do with amazon. >> i'm all about the bright spots. >> we're all about having you on set. thank you. the s&p real estate sector is barely two years old, still a baby and having growing pains. this sector is made up of reits which are high-yield because they have to pay out profits in dividends. great in a low-interest environment when investors are desperate for yields, not great when rates are rising. compared a year ago the s&p is up 16%, the real estate sector up 1%. not as bad as consumer staples, communications, but a laggard. there are some stars an interesting dynamic playing out in retail. look at prologis, a huge warehouse reit, it has seen huge growth in the last two years thanks to the amazon effect. all those goods need to be shipped to you faster and faster so there need to be more warehouses to hold them. it's moving towards another technical ceiling that could reset the trading range. now look at brick-and-mortar retail simon property group, a mall re

. >> diana olick from reality check on cnbc says renters can accumulate wealth instead of investing in a house, she says that investing in the stock market until home prices settle. >>> 5:57. millions of americans start their daily commute to and from work, a new on the go today series looks at the future of commuting. >> with roads, trains and buses, more crowded than ever, a lot of folks are looking for alternative and futuristic modes of transportation. tom costello reports from a driverless shuttle being driven from a remote location. >> reporter: good morning, i'm tom costello in california, and we are in a vehicle that is driving itself or so it seems. the truth is, the driver is in an office building and is he he can using cameras to remotely drive the vehicle with a 360 degree view and also got his own steering wheel, brake, his own gas pedal. the idea is that someday if we go to autonomous cars, we need a human backup system, and this is at least one of those options. coming up on the "today" show, we're talking about the future of commuting, what's going to come down the road

>> if you are considering buying an apartment in new york city, now might be the right time our diana olicke explanation. >> and sarah it's not just new york but i'll get to that in a second nationwide home sellers are slashing prices. more than one quarter of the home sales listed had a pris drop and that's the highest level since the company began tracking the metric in 2011 red finn ceo said buyers reached the limit and sales were slow all summer now to new york city seeing big price drops on the luxury end now that's happening to most price points more sellers slashed prices during the week after labor day than any other week since street easy began tracking that over a decade ago asking prices dropped on 744 homes beating the prove record of 713 homes set in 2009 nearly 5% of all homes listed. this will likely be the case in the coming months should mortgage rates continue to rise as they have been over the past month. higher rates take away from purchasing power and sellers will become painfully aware of that more chk on this at realty check. >> is it higher higher mortgage rates that

diana olick joins it right now with more on this. diana >> becky, i swear it's the question i get asked most and answer has suddenly changed. rent or buy, since the housing crash it's been buy. lower home prices and lower mortgage rates made the calculation pretty simple, but now both of those are sizably higher the monthly costs of buying a home an owning a home are up 14% over the past year this is more than three times the 4% increase in monthly rental costs and all this is according to realtor.com so the number of local markets where it's cheaper to rent than buy is significantly higher. as of now just 41% of the nation's population lives in a county where the median income family can afford to buy a home. looking for the numbers for july, buying a home was cheaper than renting in just 35% of the nation's counties, compared to 44% a year ago it is much local to buy than rent still in detroit, baltimore, fayetteville, north carolina, and in madison county, illinois, which is just next to st. louis. on the flip side, cheaper to ren

equipment from neighboring states that could help in this instance as well. >> thank you very much diana olick>>> the storm prompting major evacuations along the affected areas including airport closures joining us to talk to us about flight and fuel, is -- mark, why don't we start with you and what's been happening with the flights this morning already we've heard of 800 flights being canceled i imagine you'll see far bigger ripples than that. what do you see playing out right now? >> we don't see a lot of ripple effects across the country given the lack of major hubs on the coast of the carolinas but there will be hundreds more flight cancellations tomorrow. and the total effects will likely be in line with a major nor'easter >> that doesn't sound nearly as bad as some of the reports we've heard at this point. that's relatively good news, i suppose. i guess there was so much time airlines were able to move assets out of the way in time? >> yeah. they have gotten all of their crews and planes out of the area so it's not too far to get flights back in there which may resume as early as tomorro

let's get to diana olick for that. >> existing home sales in august unchanged in a seasonally adjustedn units and july's numbers were not revised that's a slight miss the street was looking for a gain to 5.38 million sales down 1.5% year over year but sales have been falling four straight month so to see it unchanged is good. home sales up 2.7% year over year to 1.92 million units available for sale at the end of august that's the first annual increase in supply in over three years. that's good news for prices, we need more supply prices up 4.6% year over year. the median price of an existing home, $264,800 but gains are decreasing we had seen price gains of 6%, 7%, 8%, now we're in the 4% range. that should make it easier for some buyers to get in at that price range. we're seeing sales drop on the lower end of the market. homes priced above a million dollaring are soaring up 12%, but that's barely 3% of the market so sales unchanged in august but we are seeing a much-needed increase in supply back to you. >> diana, thank you. >>> watching the market. dow up more than 200 points, sett

people will start asking do i really need that >> thank you let's get to diana olick and the impact on. >> if you love the marble, the granite, the quartz for your home bathroom or kitchen remodel, get ready you're about to pay more. the latest round of tariffs hits about $10 billion of chinese products exclusive to home building and remodeling. a 25% tariff would be equivalent to a 2$2.5 billion tax increase on the industry. tariffs have already hit lumber, steel, aluminum. the new round adds everything from wall and floorboard to light fix chturefixtures, cabi o mosaic tile. this builder says costs are going up so much he has to do something he hasn't had to do in over a decade in business. >> clients and contractors are setting contracts for escalation clauses, largely because we're not sure how far prices will go north. >> the tariffs will benefit u.s. manufacturers of home improvement products this quartz, we're here at m.s. international, a huge distributor in maryland of all kinds of counterstops and stone. they said because of the tariffs and potential duties from anti-dumping

one of the things i would also watch is the home construction market diana olick mentioned the interestes and how they're affecting the housing side of things the itv, that's the i shares home construction etf is down 17, 18% so far, year to date some folks are looking to that as a possible canary in the coal mine we'll see if that at least negative reaction on the near to medium term continues with those home construction related stocks as well, melissa >> taking a look at the yield. it looks as if we have a little yield compression. we have a rise in twos, and the ten-year, we actually went a little lower, on the back of the decision it's not surprise iing. >> just about 25 basis points as you said >> rick is standing by with reaction >> well, you know, let's start off with the dollar, we should give the dollar a little bit of a kick, didn't it was up 4, down a couple now 94 is significant as it trades up to and bounces and holds that level. with respect to the twos, we're 283 going in 297 on 5s. here's something interesting the tightest distance on the curve is 7 to 10, that would ma

diana olick fakes a closer look at the reits, nice to have you in the house. >> the s&p real estate sector made up of reits the real estate investment trusts, high yield because they have to pay out profits in divides. investors love them in the low interest rate viefrmt when desperate for yield but not when rates are rising which with he know they are now. now if we go back a year and compare, the s&p is up over 16%. the real estate sector barely over 1%. not as bad as consumer staple, communications and there are some stocks in the sector though that are stars and interesting dynamic playing out would you believe in realtime. look at pro logic. this is a huge warehouse reit. not brick and mortar but it has seen huge growth in two years thanks to the amazon affect. all the goods need to be shipped faster and need to be warehouses to hold it it's moving toward another technical ceiling that could reset the trading raenl. look at brick and mortar retail. simon property group is a mall reit everyone is a says realtime brick and mortar is dead but they are doing well why well, they weren't se

diana olick joins us with more on what's happened since. subprime mortgage market collapsed a decade ago fannie mae or freddie mac backed -- nothing like it does today. >> everything worked in a housing crisis that people say could lasted for decades lasted for several years and home prices quickly started to regain value. if anybody said that these saw this in 2008 or 2009, i think they're kidding themselves. its been remarkable. >> reporter: under government conservatorship fannie and freddie drew money from the treasury but were required to pay any profits back to the government and ten years later uncle sam is reaping the rewards. they drew $194 billion from the treasury and so far have paid 279.7 billion back, a net profit of $88.3 billion and they continue to pay. some argue that profit is part of why congress and the administration have done very little beyond offering proposals for reforming the mortgage market. >> the taxpayers are the ultimately vulture investors here. we bought low when nobody else would come in and as a result t

diana olick joins us this morning. >> the s&p real estate sector is barely two years old still just ar is made up of reits great in a low interest rate environment when investors are separate for yield, but not when rates are rising which of course they are now compared to a year ago, the s&p is up over 16% the real estate sector, up barely over 1% not as bad as consumers staples and communications the real estate sector is hit with tariffs all kinds of goods that go into commercial construction. let's zero in on timber reit warehouser china put 25% tariff on pine log exports. analysts say that will create near term choppiness as the impact is looked at. as an important component of its strategy some argue that despite the increase in term costs, u.s. reits are relatively immune to trade wars and a great hedge against inflation. back to you guys >> thank you >>> when we come back, a lot more to come kwoo we're going to talk markets. take a look at u.s. equity futures right now. dow looks it would open off 75 points right now nasdaq off about 29 points back in a moment need a change of