Home builder confidence is holding steady in September, bolstered by strong buyer demand despite affordability concerns, according to the latest data from the National Association of Home Builders.
The current reading of the NAHB/Wells Fargo Housing Market Index was 67 points; readings over 50 points signify a positive sentiment. Year-over-year, builder confidence is up three points, but down from May's high reading of 70 points. Rising costs are a prime source of concern for builders, as the Trump administration tariffs threatened and imposed on Chinese products puts a $1 billion tariff on housing, CNBC reports. "Free trade is better for builders," says NAHB chief economist Robert Dietz, adding, "Housing affordability is becoming a challenge, as builders face overly burdensome regulations and rising material costs exacerbated by an escalating trade skirmish."
"Despite rising affordability concerns, builders continue to report firm demand for housing, especially as millennials and other newcomers enter the market," said NAHB Chairman Randy Noel, a custom homebuilder from LaPlace, Louisiana. "The recent decline in lumber prices from record-high levels earlier this summer is also welcome relief, although builders still need to manage construction costs to keep homes competitively priced."
Advertisement
Related Stories
Design
What Gen-Z Buyers Really Want in a Home
The fervor of planning for Millennials in the home building industry has now pivoted to Gen Z. So, what does this new generation want?
Building Materials
Lumber Leads Building Materials Prices Higher in March
Overall, the cost of building materials rose during March, with softwood lumber, gypsum products, and concrete all seeing price increases. Only steel mill materials saw price drops
Demographics
Post-Pandemic Trends: Working From Home
A greater share of workers are still working from home than before the pandemic and they're concentrated in the information, professional, and financial services sectors