Confidence among U.S. homebuilders deteriorated further in August, with the National Association of Home Builders/Wells Fargo Housing Market Index slipping to 32 from 33 a month earlier. Economists had anticipated an uptick to 34. The latest reading matches the lowest level since December 2022 and extends a 16-month run of sub-50 scores that signal prevailing pessimism in the single-family market. Persistent affordability headwinds drove the decline. Freddie Mac data show the average rate on a 30-year fixed mortgage eased to 6.58% last week, but builders say that still deters many buyers. Sixty-six percent of firms offered sales incentives in August, the highest share in the post-pandemic period, and 37% reported cutting prices by an average 5%. “Affordability continues to be the top challenge for the housing market,” NAHB Chairman Buddy Hughes said. Chief Economist Robert Dietz added that lower policy rates could eventually ease financing costs for construction and mortgages. The softness in housing echoes broader service-sector weakness. A separate Federal Reserve Bank of New York survey showed its Services Business Activity index dropping to –11.7 in August from –9.3 in July, underscoring sluggish demand as higher borrowing costs ripple through the economy.