flexiblefullpage - default
Currently Reading

Home Builder Sentiment Is Rising for the First Time in Over a Year—Here’s Why

Advertisement
billboard - default
Market Data + Trends

Home Builder Sentiment Is Rising for the First Time in Over a Year—Here’s Why

A slight drop in mortgage interest rates is motivating prospective buyers to jump back into the for-sale market, and that new activity is boosting home builder sentiment at the start of 2023


January 26, 2023
Builder using circular saw to cut timber framing for building a new home
Image: Stock.adobe.com

After 12 consecutive monthly declines, builder sentiment rose for the first time in January thanks to a slight drop in mortgage interest rates. The National Association of Homebuilders’ (NAHB) national Housing Market Index (HMI) rose from December’s low of 31 to 35 last week, and while there’s still plenty of room for improvement, the recent gain sets the tone for a more optimistic year of home building in 2023.

Rates on a 30-year fixed mortgage fell from 7% to 6.61% in November as a market correction led to price drops in some overheated markets. By Jan. 5, 2023, rates had tapered off even further, reaching a more affordable 6.48%, which caused a small but promising uptick in homebuyer demand.

The NAHB is predicting that with increased homebuilder sentiment following the news of lower mortgage interest rates, we’re likely to see an increase in permits and new builds for single-family homes.

But it’s important to put things in perspective. Homebuilder sentiment grew a healthy four points month-over-month to 35. While 35 is a better score than last month, generally, homebuilders are considered to be optimistic when the number is at 50 or higher.

Read more

Related Stories

Builders

Home Builder Incentives and Price Reductions Are Finally Paying Off

Home building company KB Home reported a drop in cancellations at the start of 2023 after a major slowdown in buyer activity during the final quarter of 2022

Builders

Home Builders Remain Optimistic Despite Market Headwinds

Buyers are retreating as mortgage rates rise, but home builders are looking ahead to strong growth in the new-home market in 2023

Human Resources

It's Personal: Pilot Program Promotes Mental Health Awareness in Construction

The National Association of Home Builders partners with mental health advocate Dr. Sally Spencer-Thomas on a strategic plan to promote mental health and suicide prevention

Advertisement
boombox1 -
Advertisement
native1 - default
halfpage2 -

More in Category




Advertisement
native2 - default
Advertisement
halfpage1 -

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.