Builder confidence reached its lowest point since July 2020 in August, falling five points to a level of 75 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index.
NAHB Chairman Chuck Fowke said some prospective home buyers are experiencing “sticker shock” due to high construction costs.
"While the demographics and interest for home buying remain solid, higher costs and material access issues have resulted in lower levels of home building and even put a hold on some new home sales," NAHB Chief Economist Robert Dietz added in a statement. "While these supply-side limitations are holding back the market, our expectation is that production bottlenecks should ease over the coming months and the market should return to more normal conditions."
Builder confidence levels have reached record highs over the past year after experiencing record-lows at the outset of the pandemic. Levels above 50 are considered positive market indicators.
