Builders are Cutting Prices, Adding Incentives as Confidence Wanes

Builders are Cutting Prices, Adding Incentives as Confidence Wanes

The National Association of Home Builder’s (NAHB’s) index measuring the confidence of builders in the new home market has fallen for the ninth straight month. A 3-point month-over-month drop put the NAHB/Wells Fargo Housing Market Index (HMI) at 46 in September. NAHB’s chief economist Robert Dietz said, with the exception of the period immediately after the onset of the 2020 pandemic, the index was at its lowest point since May 2014. The continuing decline in the index is another sign that elevated interest rates , persistent building material supply chain disruptions and high home prices are combining to take a toll on affordability, Dietz said. The HMI is projecting an ongoing decline in the volume of single-family housing starts, as noted in the graph below. The HMI is deri