Market uncertainty exacerbated by the government shutdown along with economic uncertainty stemming from tariffs and rising construction costs kept builder confidence firmly in negative territory in November.
Builder confidence in the market for newly built single-family homes rose one point to 38 in November, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).
While lower mortgage rates are a positive development for affordability conditions, many buyers remain hesitant because of the recent record-long government shutdown and concerns over job security and inflation. We continue to see demand-side weakness as a softening labor market and stretched consumer finances are contributing to a difficult sales environment. After a decline for single-family housing starts in 2025, NAHB is forecasting a slight gain in 2026 as builders continue to report future sales conditions in marginally positive territory.
In a further sign of ongoing challenges for the housing market, the latest HMI survey also revealed that 41% of builders reported cutting prices in November, a record high in the post-Covid period and the first time this measure has passed 40%. Meanwhile, the average price reduction was 6% in November, the same rate as the previous month. The use of sales incentives was 65% in November, tying the share in September and October.
Derived from a monthly survey that NAHB has been conducting for more than 40 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.
The HMI index gauging current sales conditions increased two points to 41, the index measuring future sales fell three points to 51 and the gauge charting traffic of prospective buyers posted a one-point gain to 26.
Looking at the three-month moving averages for regional HMI scores, the Northeast rose two points to 48, the Midwest fell one point to 41, the South increased three points to 34 and the West gained two points to 30. HMI tables can be found at nahb.org/hmi.
This article was originally published by a eyeonhousing.org . Read the Original article here. .
