U.S. Homebuilder Sentiment Drops to Joint-Least Since 2022
NAHB Housing Market Index comes in below the 50 dividing line between poor/good conditions for a 29th consecutive month, and below 40 for a 17th straight month, the longest such stretch since 2012.
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U.S. NAHB Housing Market Index Sep: 32 (est 34; prev 35)
Executive Summary:
- The NAHB home builder Housing Market Index fell -3 points in September to 32, matching the June/August 2025 lows as the weakest since September 2025, and the lowest level since late 2022 (Dec 2022 was 31). It remains well below the 50 dividing line between poor/good conditions for a 29th consecutive month, and below 40 for a 17th straight month, the longest such stretch since 2012.
- Current and future sales both fell sharply while buyer traffic held steady at a low level; future sales the lowest since early 2023.
- 38% of builders cut prices in September, up from 35% in August, while the average price cut held at 6% for a sixth consecutive month. The use of sales incentives rose to 66% from 63%, the highest share since December’s 67%.
The NAHB home builder Housing Market Index fell -3pts in September to 32 matching the June/August 2025 lows as the weakest since September 2025, and the lowest level since late 2022 (Dec 2022 was 31). It remains well below the 50 dividing line between poor/good conditions for a 29th consecutive month, and below 40 for a 17th straight month, the longest such stretch since 2012.
Looking at the components:
- The current sales component fell -4pts to 35 (the least since Sept 2025, when it was 34), it hasn’t been above 50 since January 2025;
- Sales expectations the next 6 months dropped -6pts to 37, the least since January 2023 and a 9th consecutive month below the 50 breakeven; and
- Buyer traffic held steady at just 23 (it hasn’t been above 50 since May 2022).
On concessions, 38% of builders cut prices in September, up from 35% in August, while the average price cut held at 6% for a sixth consecutive month. The use of sales incentives rose to 66% from 63% in August, the highest share since December’s 67%, marking the 18th consecutive month this share has reached 60% or higher.
“Buyer traffic has weakened across much of the country, largely because of rising mortgage rates,” said NAHB Chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. “Builders also continue to face higher material costs, rising gas and diesel prices and persistent labor shortages. In some markets, builders report that increased immigration enforcement is discouraging legal workers from reporting to job sites.”
“The HMI shows builder confidence at its lowest level since September 2025, as tight lending conditions and elevated land, labor and construction costs persist,” said NAHB Chief Economist Robert Dietz. “Notably, 42% of builders rated current lot availability as poor and 38% as fair.”
Builder confidence dropped in all regions but the West, but all remained well under 50:
- The Northeast fell -7pts to 35, the lowest since January 2023,
- The South, by far the largest homebuilding market, fell -4pts to 29, matching Jul-Sept 2025 as the lowest in a year,
- The Midwest dropped -4pts to 41, and
- The West rose +1pt to 29.
https://www.nahb.org/news-and-economics/housing-economics/indices/housing-market-index
