Builder confidence held steady in September, but falling mortgage rates and expected Fed cuts lifted future sales expectations, NAHB/Wells Fargo index shows.
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Confidence in the multifamily housing market showed tentative signs of improvement in the second quarter, with builder sentiment rising modestly year-over-year despite persistent challenges from high interest rates and construction costs, according to the latest National Association of Home Builders survey.
The National Association of Home Builders' remodeling index dropped to 59 in Q2, marking only the second time since 2020 that the measure has fallen below 60, with western markets particularly affected by economic uncertainty.
A landmark study released by the Home Builders Institute (HBI) and National Association of Home Builders (NAHB) reveals the skilled labor shortage is costing the residential construction industry $10.8 billion annually and preventing the construction of approximately 19,000 single-family homes.
For the first quarter of 2025, single-family construction growth registered modest gains in small metro areas and declines in large metro counties, while apartment growth is shifting to counties with lower population densities.
The narrow price gap between new and existing homes results from tight inventory in the existing market, where homeowners with low pandemic-era mortgage rates are hesitant to sell due to high current rates, combined with post-pandemic price surges across both segments, driven by rising construction costs and supply shortages.