Industry News

Housing affordability erodes builder confidence

Trade group fears further interest-rate hikes

Builder confidence in the single-family market slipped three more notches to 39 in July, as interest rates and housing affordability continued to worry builders, according to an industry index released Tuesday. The NAHB/Wells Fargo Housing Market Index (HMI), which is derived from a monthly survey of builders that gauges builder perceptions of current and future home sales and traffic of prospective buyers, sank for the fifth consecutive month amid softening market conditions. Scores for each component are used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor. All three component indexes fell in July. The largest decline was in the index gauging sales expectations for the next six months, which fell five points to 46. The index gauging current sales of new single-family homes fell four points to 43, and the index gauging traffic of prospective buyers fell two points to 27. "The HMI is down from ...