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Builder Sentiment Falls on Rising Rates – Eye On Housing

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Rising mortgage rates, energy and material costs, and worsening labor and lot conditions have pushed builder sentiment to a 14-year low.

Builder confidence in the market for newly built single-family homes fell three points to 29 in October, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The reading was the lowest since June 2012.

Housing remains squeezed by supply-side constraints and significant affordability challenges. Mortgage rates have climbed well above 7% in recent weeks. Though builders are also contending with higher costs for construction loans, building materials and diesel, the administration’s efforts to advance regulatory reform are helping to ease some of the cost pressures they face.

Demand persists, but higher mortgage rates, elevated construction costs and weaker consumer confidence are keeping more buyers on the sidelines. As a result, buyer traffic has fallen to its lowest level since April 2012, excluding the pandemic’s onset in April 2020.

Nationwide, more than one-third of builders reported immigration enforcement activity in their market areas during the past month, causing construction delays and discouraging legal workers from reporting to work.

The latest HMI survey found that 43% of builders cut prices in October, the highest share during the 2020-2026 period. The average price cut remained at 6% for the seventh consecutive month. Meanwhile, 65% of builders reported using sales incentives in October, the 19th straight month at least 60% of builders have done so.

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.

All three of the major HMI indices posted losses in October. The index measuring current sales conditions fell two points to 33, the index gauging future sales expectations dropped five points to 32 and the index charting prospective buyer traffic fell five points to 18.

Looking at the three-month moving averages for regional HMI scores, the Northeast dropped one point to 38, the Midwest fell three points to 40, the South fell one point to 30 and the West posted a two-point decline to 26. The Midwest is a relatively bright spot for single-family home building, with permits up 2.9%

The HMI tables can be found at nahb.org/hmi.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Remodeling Market Sentiment Remains Stable in Third Quarter Despite Headwinds – Eye On

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In the third quarter of 2026, the NAHB Remodeling Market Index (RMI) posted a reading of 62, up one point compared to the previous quarter. The RMI has remained within a narrow band between 59 and 70 for the past four years. Remodeler sentiment remains the standout sector within the housing industry, when compared to its single-family and multifamily counterparts.

Despite sentiment remaining stable, remodelers report that economic uncertainty is making some potential customers hesitant to move forward with projects. Labor shortages, exacerbated by immigration enforcement and competition from data center construction, are extending the time it takes to complete projects. Nevertheless, remodeling is gaining share in the overall construction market, as it is somewhat less sensitive than new construction to the current elevated interest rates. NAHB’s projection for remodeling activity will remain stable in 2026 and grow slightly in 2027, which is consistent with today’s reading.

The RMI is based on a survey that asks remodelers to rate various aspects of the residential remodeling market “good”, “fair” or “poor.” Responses from each question are converted to an index that lies on a scale from 0 to 100. An index number above 50 indicates a higher proportion of respondents view conditions as good rather than poor.

Current Conditions

The Remodeling Market Index (RMI) is an average of two major component indices: the Current Conditions Index and the Future Indicators Index. 

The Current Conditions Index is an average of three components: the current market for large remodeling projects ($50,000 or more), moderately-sized projects ($20,000 to $49,999), and small projects (under $20,000).

In the third quarter of 2026, the Current Conditions Index averaged 70, which remained unchanged for the third consecutive quarter. The component measuring large remodeling projects increased two points to 66, while the small projects component inched down one point to 73, and the moderately-sized projects component decreased two points to 71.

Future Indicators

The Future Indicators Index is an average of two components: the current rate at which leads and inquiries are coming in, and the current backlog of remodeling projects. 

In the third quarter of 2026, the Future Indicators Index averaged 54, up two points from the previous quarter. Both the component measuring backlog of remodeling jobs and the current rate at which leads and inquiries increased two points to 56 and 53, respectively, for the quarter.

For the full set of RMI tables, including regional indices and a complete history for each RMI component, please visit NAHB’s RMI web page.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Builder Sentiment Falls on Higher Interest Rates and Costs – Eye On Housing

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Higher mortgage rates, worsening labor shortages and rising material costs are weighing on builder sentiment.

Builder confidence in the market for newly built single-family homes fell three points to 32 in September, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today.

Buyer traffic has weakened across much of the country, largely because of rising mortgage rates. Builders also continue to face higher material costs, rising gas and diesel prices and persistent labor shortages. In some markets, builders report that increased immigration enforcement is discouraging legal workers from reporting to job sites.

The HMI shows builder confidence at its lowest level since September 2025, as tight lending conditions and elevated land, labor and construction costs persist. Notably, 42% of builders rated current lot availability as poor and 38% as fair.

The latest HMI survey found that 38% of builders cut prices in September, up from 35% in August. The average price cut remained at 6% for the sixth consecutive month. Meanwhile, 66% of builders reported using sales incentives in September, up from 63% in August and the highest share since 67% posted in December.

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 index measuring current sales conditions in September fell four points to 35, the index gauging future sales expectations dropped six points to 37 and the index charting prospective buyer traffic held steady at 23.

Looking at the three-month moving averages for regional HMI scores, the Midwest dropped one point to 44, the Northeast fell five points to 39, the South fell one point to 31 and the West posted a one-point gain to 28.

The HMI tables can be found at nahb.org/hmi.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Builder Sentiment Stays Weak as Affordability Concerns Persist – Eye On Housing

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Economic uncertainty and persistent affordability challenges driven by rising material prices, high land costs, and elevated mortgage rates continue to weigh on builder sentiment.

Builder confidence in the market for newly built single-family homes fell two points to 34 in July, down from an upwardly revised reading of 36 in June, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Sentiment has remained below 40 for 15 consecutive months, the longest such stretch since 2012.

With the HMI below 40 for 15 straight months, affordability remains the home building industry’s primary challenge, as elevated mortgage rates, costly land, rising material prices, and persistent skilled labor shortages continue to affect the market. Looking ahead, the newly enacted 21st Century ROAD to Housing Act is a positive step that will help expand housing supply and lower overall housing costs, although more policy change is needed at the state and local level.

The latest HMI survey also revealed that 37% of builders cut prices in July, up from 35% in June and 32% in May. The average price reduction was 6% in July, the same rate as the previous month. The use of sales incentives was 63% in July, up slightly from 62% in June, and marking the 16th consecutive month this share has reached 60% or higher.

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.

All of the HMI sub-indices posted declines in July. The HMI index gauging current sales conditions fell one point to 37, the index measuring future sales dropped two points to 43 and the index charting traffic of prospective buyers posted a two-point decline to 23.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose one point to 45, the Midwest increased two points to 45, the South fell one point to 33 and the West dropped one point to 26. The HMI tables can be found at nahb.org/hmi.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Remodeling Market Sentiment Remains in Positive Territory in Second Quarter – Eye On Housing

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In the second quarter of 2026, the NAHB Remodeling Market Index (RMI) posted a reading of 61, down one point compared to the previous quarter. The RMI has remained in the low 60s consistently over the past year.

Even with this slight decline from the previous quarter, remodeler sentiment remains the standout sector within the housing industry, outperforming both its single-family and multifamily counterparts.  

With current mortgage rates above the median outstanding rate for existing homeowners, the incentive to remodel instead of purchasing a new home given the low levels of existing inventory persists due to this lock-in effect. Additionally, homeowners are sitting on record high real estate asset gains which they are able to tap into making it easier to fund remodeling projects. However, ongoing economic uncertainty and current cost pressures due to inflation are causing project delays, especially for larger ones. In the latest RMI survey, 74% of remodelers reported that their suppliers have increased prices of materials since March due to higher fuel costs, with the average increase in materials prices over that span being 6.7%. 

Nevertheless, based on the positive sentiment from the RMI and structural demand tailwinds, NAHB’s forecast for remodeling spending remains robust both in the short-term and over the long run.

The RMI is based on a survey that asks remodelers to rate various aspects of the residential remodeling market “good”, “fair” or “poor.” Responses from each question are converted to an index that lies on a scale from 0 to 100. An index number above 50 indicates a higher proportion of respondents view conditions as good rather than poor.

Current Conditions

The Remodeling Market Index (RMI) is an average of two major component indices: the Current Conditions Index and the Future Indicators Index. 

The Current Conditions Index is an average of three components: the current market for large remodeling projects ($50,000 or more), moderately-sized projects ($20,000 to $49,999), and small projects (under $20,000).

In the second quarter of 2026, the Current Conditions Index averaged 70, unchanged from the previous quarter. The component measuring moderately-sized remodeling projects increased four points to 73, while the small projects component remained unchanged at 74 and the large projects component decreased three points to 64. 

Future Indicators

The Future Indicators Index is an average of two components: the current rate at which leads and inquiries are coming in, and the current backlog of remodeling projects.

In the second quarter of 2026, the Future Indicators Index averaged 52, down two points from the previous quarter. Both components decreased quarter-over-quarter but still remain above the break-even point of 50. The component measuring backlog of remodeling jobs was down two points to 54, while the component measuring the current rate at which leads and inquiries are coming in edged down one point to 51.

For the full set of RMI tables, including regional indices and a complete history for each RMI component, please visit NAHB’s RMI web page.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Builder Sentiment Remains Weak Amid Affordability Concerns – Eye On Housing

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Builder sentiment remains subdued as rising material costs, elevated mortgage rates and ongoing affordability challenges continue to strain the housing market.

Builder confidence in the market for newly built single-family homes fell two points to 35 in June, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). This is the 14th straight month that sentiment has remained below 40, a streak not seen since 2011-2012 during the foreclosure crisis.

Costly and inefficient regulatory policy is clearly impeding the ability of builders to increase the housing supply. According to a new NAHB study, government regulation, taxes, fees and other costs add more than 26% to the price of an average single-family home. Easing permitting bottlenecks, density limits and inefficient zoning rules would help reduce costs and support the housing growth the nation needs.

The latest HMI survey also revealed that 35% of builders cut prices in June, up from 32% in May. The average price reduction was 6% in June, the same rate as the previous month. The use of sales incentives was 62% in June, up slightly from 61% in May, and marking the 15th consecutive month this share has reached 60% or higher.

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 fell two points to 38 in June, the index measuring future sales held steady at 45 and the index charting traffic of prospective buyers remained unchanged at 25.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose two points to 44, the Midwest held constant at 43, the South fell two points to 33 and the West dropped one point to 27. The HMI tables can be found at nahb.org/hmi.

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This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Builder Sentiment Posts Gain in May but Significant Affordability Challenges Persist – Eye

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Builder confidence posted a modest gain in May even as buyers grapple with rising mortgage rates and economic uncertainty while builders continue to contend with elevated land, labor and construction costs.

Builder confidence in the market for newly built single-family homes increased three points to 37 in May, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).

Recent increases for long-term interest rates will continue to hold back home buyer demand. Although some regional markets, including parts of the Midwest, are showing relative strength, the housing market continues to face significant affordability challenges.

On the policy front, efforts in the House to modify the 21st Century ROAD to Housing Act could increase the nation’s housing supply and help ease builder concerns. In particular, the revision in the House bill with respect to the harmful built-to-rent proposal is a positive development.

The latest HMI survey also revealed that 32% of builders cut prices in May, down from 36% in April. The average price reduction was 6%, up from the 5% figure in April. The use of sales incentives was 61% in May, up slightly from 60% in April, and marking the 14th consecutive month this share has reached 60% or higher.

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.

All three of the major HMI indices posted gains in May, as some buyers who had been holding back decided to move forward this spring. The HMI index gauging current sales conditions rose three points to 40 from April to May, the index measuring future sales increased three points to 45 and the index charting traffic of prospective buyers posted a three-point gain to 25.

Looking at the three-month moving averages for regional HMI scores, the Midwest registered a one-point gain to 43, the Northeast rose one point to 42, the South held constant at 35 and the West fell one point to 28.

The HMI tables can be found at nahb.org/hmi.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Builder Sentiment Posts Notable Decline on Economic Uncertainty – Eye On Housing

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Economic uncertainty coupled with rising building material costs and interest rates resulted in a sharp decline in builder sentiment in April as the housing market enters into the heart of the spring buying season.

Builder confidence in the market for newly built single-family homes fell four points to 34 in April, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). This is the lowest level since September 2025.

Builder sentiment fell back in spring as buyers face ongoing elevated interest rates and growing economic uncertainty. The year started with hopes for housing momentum growth, but risks with respect to the Iran war, energy costs, and declines for consumer confidence have slowed the market.

With oil prices higher in the U.S., 62% of builders reported suppliers have increased building material costs due to higher fuel prices, including gas and diesel. Energy costs make up approximately 4% of residential construction material input and service costs.  With near-term economic risks elevated, 70% of builders reported challenges pricing homes given uncertainty about material costs.

The latest HMI survey also revealed that 36% of builders cut prices in April, down slightly from 37% in March. The average price reduction was 5%, down from the 6% figure in March. The use of sales incentives was 60% in April, down from 64% in March, and marking the 13th consecutive month this share reached 60% or higher.

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.

All three of the major HMI indices posted losses in April. The HMI index gauging current sales conditions fell four points to 37 from March to April, the index measuring future sales dropped seven points to 42 and the index charting traffic of prospective buyers posted a three-point decline to 22.

Looking at the three-month moving averages for regional HMI scores, the Northeast fell two points to 42, the Midwest dropped two points to 41, the South held constant at 35 and the West fell three points to 29.

The HMI tables can be found at nahb.org/hmi.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Remodeling Market Sentiment Edges Down but Remains Positive in First Quarter – Eye On

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In the first quarter of 2026, the NAHB/Westlake Royal Remodeling Market Index (RMI) posted a reading of 62, down two points compared to the previous quarter. Despite this decline, the overall reading has been solidly in positive territory since Q1 2020.

Remodeler sentiment remained generally positive in the first quarter, even as many remodelers are still working to manage their customers’ cost expectations. Only a relatively small share report homeowners putting projects on hold due to economic and political uncertainty.

Ongoing positive remodeler sentiment is consistent with NAHB’s outlook, given an aging housing stock and the lock-in effect of elevated mortgage rates keeping owners in the homes longer. In the first quarter, remodelers reported 21% of their projects were associated with home improvements made shortly after a purchase, while only 4% were for homeowners’ projected to ready a home for sale.

The RMI is based on a survey that asks remodelers to rate various aspects of the residential remodeling market “good”, “fair” or “poor.” Responses from each question are converted to an index that lies on a scale from 0 to 100. An index number above 50 indicates a higher proportion of respondents view conditions as good rather than poor.

Current Conditions

The Remodeling Market Index (RMI) is an average of two major component indices: the Current Conditions Index and the Future Indicators Index. 

The Current Conditions Index is an average of three components: the current market for large remodeling projects ($50,000 or more), moderately-sized projects ($20,000 to $49,999), and small projects (under $20,000). In the first quarter of 2026, the Current Conditions Index averaged 70, edging down one point from the previous quarter. All three components remained well above 50 in positive territory. The component measuring small remodeling projects was the only one to experience a quarterly gain, inching up one point to 74. Both the moderate and large remodeling projects components were down two points to 69 and 67, respectively.

Future Indicators

The Future Indicators Index is an average of two components: the current rate at which leads and inquiries are coming in, and the current backlog of remodeling projects. 

In the first quarter of 2026, the Future Indicators Index averaged 54, down two points from the previous quarter. Both components decreased quarter-over-quarter but are above the break-even point of 50. The component measuring the current rate at which leads and inquiries are coming in edged down one point to 53, while the component measuring backlog of remodeling jobs dropped three points to 58.

For the full set of RMI tables, including regional indices and a complete history for each RMI component, please visit NAHB’s RMI web page.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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Builder Sentiment Inches Higher but Affordability Concerns Persist – Eye On Housing

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Builder sentiment inched up in March even as builders continue to express affordability concerns stemming from elevated construction costs and shortages of buildable lots and labor.

Builder confidence in the market for newly built single-family homes rose one point to 38 in March, following a revised upward one-point revision in February, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). All responses to the March survey were received after the conflict with Iran started.

Affordability for buyers and builders remains a top concern. Many buyers remain on the fence waiting for lower interest rates and due to economic uncertainty.

While the Freddie Mac 30-year fixed rate mortgage averaged 6.05% in February, the lowest since August 2022, downpayment hurdles and uncertainty from the conflict with Iran and the price of oil will be headwinds going forward. The administration’s executive orders issued last week to reduce regulatory burdens associated with home building are a positive step toward increasing attainable housing supply.

The latest HMI survey also revealed that 37% of builders cut prices in March, up slightly from 36% in February. The average price reduction remained stable at 6%. The use of sales incentives was 64% in March, down one percentage point from February, and marking the 12th consecutive month this share exceeded 60%.

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.

All three of the major HMI indices posted gains in March. The HMI index gauging current sales conditions increased one point to 42 from February to March, the index measuring future sales gained two points to 49 and the index charting traffic of prospective buyers posted a three-point increase to 25.

Looking at the three-month moving averages for regional HMI scores, the Northeast held steady at 44, the Midwest was unchanged at 43, the South held constant at 35 and the West fell two points to 31. The HMI tables can be found at nahb.org/hmi.



This article was originally published by a eyeonhousing.org . Read the Original article here. .

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