The National Association of Home Builders’ Housing Market Index is a monthly measure of how home builders feel about the market for newly built single-family homes. Based on a survey, the index is scored on a scale where any number above 50 indicates more builders view conditions as good than poor. In September, the index fell three points to 29. Robert Dietz, NAHB’s chief economist, says buyer traffic has fallen. “Housing remains squeezed by supply-side constraints and significant affordability challenges,” Dietz said. “Demand persists, but higher mortgage rates, elevated construction costs, and weaker consumer confidence are keeping more buyers on the sidelines. As a result, buyer traffic has fallen to its lowest level since April 2012.” In response, home builders have taken to offering incentives and price cuts to lure buyers. In fact, 43 percent of home builders cut prices in September, while 65 percent reported using sales incentives. (source)
