In November, builder confidence was firmly in negative territory due to market uncertainty worsened by the government shutdown, as well as economic uncertainty caused by tariffs and rising building prices.
According to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), builder confidence in the market for newly built single-family homes increased by one point in November to 38.
While decreasing mortgage rates are a welcome development for affordability, many purchasers are still cautious due to the recent record-breaking government shutdown, as well as fears about job security and inflation.
We continue to expect demand-side difficulties, as a weaker job market and strained consumer finances contribute to a difficult sales environment.
After a fall in single-family housing began in 2025, NAHB forecasts a tiny increase in 2026 as builders continue to anticipate moderately positive future sales prospects.
In another indicator of the housing market’s persistent troubles, the most recent HMI poll indicated that 41% of builders reported reducing prices in November, a record high in the post-Covid period and the first time this measure has surpassed 40%.
Meanwhile, the average price decrease in November was 6%, the same as the previous month.
In November, sales incentives were used at 65%, tying the percentage seen in September and October.
The NAHB/Wells Fargo HMI is based on a monthly poll that NAHB has been conducting for over 40 years.
It assesses builder perceptions of current single-family home sales and sales projections for the next six months as “good,” “fair,” or “bad.”
In addition, the study asks builders to rank prospective buyer traffic as “high to very high,” “average,” or “low to very low.”
The scores for each component are then used to produce a seasonally adjusted index, with any value more than 50 indicating that more builders consider conditions to be favorable rather than poor.
The HMI index evaluating current sales circumstances increased two points to 41, the index measuring future sales declined three points to 51, and the gauge mapping prospective buyer traffic increased one point to 26.
Looking at the three-month moving averages for regional HMI scores, the Northeast grew two points to 48, the Midwest decreased one point to 41, the South jumped three points to 34, and the West gained two points to 30. HMI tables are available at nahb.org/hmi.
[Read more about this topic on Eyeonhousing.org]