The National Association of Home Builders (NAHB) is indicating potential improvements in housing conditions in the upcoming months based on recent economic data.
According to, NAHB is forecasting approximately a 5% increase for single-family starts in 2024 as financial conditions ease.
The NAHB October index said that with mortgage rates running above 7% since mid-August, per Freddie Mac data, many builders continue to reduce home prices to boost sales.
In November, 36% of builders reported cutting home prices, the most since November 2022.
“The rise in interest rates since the end of August has dampened builder views of market conditions, as many prospective buyers were priced out of the market,” NAHB Chairman Alicia Huey, a custom home builder and developer from Birmingham, Ala., said in prepared remarks.
“Moreover, higher short-term interest rates have increased the cost of financing for home builders and land developers, adding another headwind for housing supply in a market low on resale inventory.
“While the Federal Reserve is fighting inflation, state and local policymakers could also help by reducing the regulatory burdens on the cost of land development and home building, thereby allowing more attainable housing supply to the market.”