Builder confidence for newly built single-family homes slipped down one point to 80 in July, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).
– The HMI index measuring current sales conditions decreased by one point to 86
– The component measuring traffic of prospective buyers dropped six points to 65
– The index measuring sales expectations in the next six months increased by two points to 81
– For the three-month moving averages for regional HMI scores, the Northeast fell four points to 75, the Midwest fell by one point to 71 and the West posted a two-point decline to 87. The South remained flat at 85.
“Builders continue to grapple with elevated building material prices and supply shortages, particularly the price of oriented strand board, which has skyrocketed more than 500% above its January 2020 level,” said NAHB Chairman Chuck Fowke. “We are grateful that the White House heeded our urgent plea to hold a building materials meeting with interested stakeholders on July 16 to seek solutions to end production bottlenecks that have harmed housing affordability.”
“Builders are contending with shortages of building materials, buildable lots and skilled labor as well as a challenging regulatory environment. This is putting upward pressure on home prices and sidelining many prospective home buyers even as demand remains strong in a low-inventory environment,” said NAHB Chief Economist Robert Dietz.