Builder Sentiment Unchanged in April
In April, builder confidence remained unchanged, attributed to mortgage rates hovering around 7% for the past month and the absence of positive changes in the latest inflation figures for the first quarter of 2024.
According to the NAHB, builder confidence in the market for newly built single-family homes was 51 in April, unchanged from March, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today. This breaks a four-month period of gains for the index, which nonetheless remains above the key breakeven point of 50.
“With many frustrated buyers back on the fence waiting for interest rates to fall, policymakers can help ease affordability challenges by reducing inefficient regulatory rules that raise housing costs and limit supply,” said NAHB Chairman Carl Harris, a custom home builder from Wichita, Kan.
“April’s flat reading suggests the potential for demand growth is there, but buyers are hesitating until they can better gauge where interest rates are headed,” said NAHB Chief Economist Robert Dietz. “With the markets now adjusting to rates being somewhat higher due to recent inflation readings, we still anticipate the Federal Reserve will announce future rate cuts later this year, and that mortgage rates will moderate in the second half of 2024.”
