US Homebuilder Sentiment Rises to 33 but Price Cuts Accelerate

Confidence among U.S. homebuilders ticked higher in July, with the National Association of Home Builders/Wells Fargo Housing Market Index rising to 33 from 32 a month earlier, matching economists’ expectations. Any reading below 50 signals that more builders view conditions as poor than good, and the gauge has remained in negative territory for 15 consecutive months. Persistent affordability pressures—chiefly elevated mortgage rates—continue to weigh on demand. NAHB said 38% of builders reported cutting prices in July, the largest share since the trade group began tracking the measure in 2022; the typical reduction held at about 5%. Builders are also using mortgage-rate buydowns and other incentives to spur sales. The slight improvement in sentiment follows passage of the federal One Big Beautiful Bill Act, which provided limited tax relief for households and construction firms. Even so, NAHB Chief Economist Robert Dietz warned that single-family housing starts are on track to fall in 2025, with permits down 6% so far this year and buyer traffic at its lowest level since late 2022.