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1h ago

U.S. Homebuilder Confidence Drops to Lowest Level Since Late 2022

Builders have slashed prices with record post-pandemic incentives to counter weak demand driven by high borrowing costs

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A "For Sale" sign stands in front of a house, on the North Shore of Long Island city of Glen Cove, New York, U.S., August 12, 2025. REUTERS/Shannon Stapleton/File Photo

Overview

  • The Housing Market Index fell to 32 in August from 33 in July, matching its weakest reading since December 2022 and missing economists’ forecast of 34.
  • Thirty-seven percent of builders cut prices by an average of 5 percent while 66 percent offered sales incentives, the highest share reported since the pandemic began.
  • The subindex for current sales conditions declined and buyer foot traffic ticked up to its strongest level since May but remained at a low level.
  • The average rate on a 30-year fixed mortgage eased to 6.58 percent, its lowest point since last October, yet financing costs continue to suppress buyer interest.
  • NAHB Chief Economist Robert Dietz urged the Federal Reserve to lower the federal funds rate to reduce construction financing costs and indirectly ease mortgage rates.