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Homebuilder confidence drops further in July as affordability pressures persist

The NAHB/Wells Fargo HMI fell to 34 in July, while price cuts broadened as 37% of builders offered them and 63% used sales incentives.

Reported · Written up by our desk · Residential

Homebuilder confidence fell again in July as affordability pressures and economic uncertainty continued to weigh on demand, according to the National Association of Home Builders and Wells Fargo Housing Market Index.

HousingWire reports the NAHB Wells Fargo HMI declined 2 points to 34, extending a stretch of 15 consecutive months below 40. The index showed negative readings for present sales at 37, prospective buyer traffic at 23, and the six-month outlook at 43.

The report also pointed to ongoing tactics to support sales, with 37% of builders saying they implemented price cuts in July, up from 35% in June. The average price reduction was 6%, and the share of builders using sales incentives rose slightly to 63%.

NAHB Chairman Bill Owens said many potential buyers remain sidelined as they wait for lower mortgage rates, more certainty on inflation, and a clearer economic outlook. NAHB chief economist Robert Dietz added that affordability remains the primary challenge, citing elevated mortgage rates, costly land, higher material prices, and skilled labor shortages.

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