US Builder Confidence for Newly Built Single-Family Homes Increases in November

On Tuesday, the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) reported that builder sentiment for newly built single-family homes increased in November to 38, up 1 point from October. Sentiment has now remained in negative territory for 19 consecutive months.

The HMI survey showed that 41% of builders reported cutting prices in November, the highest share in the post-Covid period and the first time the measure has exceeded 40%. The average price reduction was 6%, unchanged from the prior month. The use of sales incentives was 65%, matching the share reported in September and October.

The HMI component measuring current sales conditions rose 2 points to 41, while the gauge of sales expectations over the next six months fell 3 points to 51. The index tracking prospective buyer traffic increased 1 point to 26.

Regional three-month moving averages showed mixed results. The Northeast rose 2 points to 48; the Midwest fell 1 point to 41; the South increased 3 points to 34; and the West rose 2 points to 30.