Builder confidence in the market for newly built single-family homes fell to 39 in March, down three points from February and marking the lowest level in seven months, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).
Construction costs remain elevated, with builders estimating a $9,200 increase per home due to recent tariff actions. The HMI survey indicated that 29% of builders reduced home prices in March, up from 26% in February, with average reductions remaining at 5%. Sales incentives were used by 59% of builders, the same rate as in February.
The HMI index measuring current sales conditions declined by three points to 43 in March, its lowest point since December 2023. The index tracking prospective buyer traffic dropped five points to 24, while the measure for sales expectations over the next six months remained unchanged at 47.
Regional HMI data showed declines across all major regions. The Northeast fell three points to 54, the Midwest dropped three points to 42, the South decreased four points to 42, and the West declined two points to 37.
