Builder sentiment crept up one point to 38 in March, according to National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Confidence in the market for newly built single-family homes increased despite affordability concerns, elevated construction costs and shortages of buildable lots and labor. All responses to the March HMI survey were collected after the war with Iran started.
“Affordability for buyers and builders remains a top concern,” said NAHB Chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. “Many buyers remain on the fence waiting for lower interest rates and due to economic uncertainty. Builders are facing elevated land, labor and construction costs and nearly two-thirds continue to offer sales incentives in a bid to firm up the market.”
More from the survey:
- 37% of builders cut prices in March, up from 36% in February.
- The average price reduction remained at 6%.
- The use of sales initiatives was 64% in March, down one percentage point from February.
- Builders’ rating of current sales conditions rose 1 point to 42 in March, still below the HMI’s confidence threshold of 50.
- Builders’ outlook on future sales went up 2 points from February to 49.
- Builders’ traffic of potential buyers rose 3 points to 25 in March.
Read the full report here.
