Builder Sentiment Declines on Economic Uncertainty

Economic uncertainty coupled with rising building material costs and interest rates resulted in a sharp decline in builder sentiment in April, the National Association of Home Builders/Wells Fargo Housing Market Index reported.

Builder confidence in the market for newly built single-family homes fell four points to 34 in April– the lowest level since September 2025, the HMI survey said.

“Builder sentiment has fallen back in spring as buyers face ongoing elevated interest rates and growing economic uncertainty,” NAHB Chairman Bill Owens noted. “The year started with hopes for housing momentum growth, but risks with respect to the Iran war, energy costs and declines for consumer confidence have slowed the market.”

The latest HMI survey also revealed that 36% of builders cut prices in April, down slightly from 37% in March. The average price reduction was 5%, down from the 6% figure in March. The use of sales incentives was 60% in April, down from 64% in March, and marking the thirteenth consecutive month this share has reached 60% or higher.

The NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” It also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” All three of the major HMI indices posted losses in April. The HMI index gauging current sales conditions fell four points to 37 from March to April, the index measuring future sales dropped seven points to 42 and the index charting traffic of prospective buyers posted a three-point decline to 22.