Builder sentiment climbed one point to 38 in November; anything below 50 is considered negative for the National Association of Home Builders’ monthly survey, according to NAHB. It reached a record high of 90 in November 2020.
Regarding the three components of the homebuilder index, sales expectations fell three points to 51; current sales conditions climbed two points to 41; and buyer traffic increased one point to 26.
Forty-one percent of builders reported cutting prices in November compared with 38% in October, 39% in September and 37% in August. The average price discount was unchanged at 6%. Sixty-five percent of builders were using sales incentives other than price cuts to improve sales in November, which is unchanged from October.
“While lower mortgage rates are a positive development for affordability conditions, many buyers remain hesitant because of the recent record-long government shutdown and concerns over job security and inflation,” said NAHB Chairman Buddy Hughes. “More builders are using incentives to get deals closed, including lowering prices, but many potential buyers still remain on the fence.”
