Builder confidence in the newly built single-family homes market rose one point to 39 in December, according to the National Association of HomeBuilders/Wells Fargo Housing Market Index. While confidence levels inched up at the end of the year, every month of 2025 saw levels below 50, indicating more builders view conditions as poor than good.
“Market conditions remain challenging with two-thirds of builders reporting they are offering incentives to move buyers off the fence,” said NAHB Chairman Buddy Hughes, a home builder and developer from Lexington, N.C. “Meanwhile, builders are contending with rising material and labor prices, as tariffs are having serious repercussions on construction costs.”
Regionally, the Northeast fell one point to 47, the Midwest increased two points to 43, the South rose two points to 36 and the West increased four points to 34.
The latest HMI survey also found that 40% of builders reported cutting prices this month, making December the second consecutive month the share has been at 40% or higher since May 2020. The average price reduction was 5% in December, down from 6% in November. The use of sales incentives came in at 67% for December, the highest rate in the post-COVID period.
Read the full report here.
