U.S. Housing Market Index Drops To Fourteen-Year Low In October
(RTTNews) - A report released by the National Association of Home Builders on Monday showed a bigger-than-expected deterioration in U.S. homebuilder sentiment in the month of October.
The report said the NAHB/Wells Fargo housing market index fell to 29 in October from 32 in September. Economists had expected the index to edge down to 31.
With the bigger-than-expected decrease, the housing market index dropped to its lowest level since hitting a matching figure in June 2012.
"Housing remains squeezed by supply-side constraints and significant affordability challenges," said NAHB Chief Economist Robert Dietz. "Demand persists, but higher mortgage rates, elevated construction costs and weaker consumer confidence are keeping more buyers on the sidelines."
He added, "As a result, buyer traffic has fallen to its lowest level since April 2012, excluding the pandemic's onset in April 2020."
The NAHB said the index charting prospective buyer traffic plunged to 18 in October from 23 in September.
The index gauging future sales expectations also slumped to 32 in October from 37 in September, while the index measuring current sales conditions fell to 33 in October from 35 in September.
The report also said the latest HMI survey found that 43 percent of builders cut prices in October, the highest share during the 2020-2026 period. The average price cut remained at 6 percent for the seventh consecutive month.
Meanwhile, 65 percent of builders reported using sales incentives in October, the 19th straight month at least 60 percent of builders have done so, the NAHB said.
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