WASHINGTON, DC — Builder confidence inched up this month on lower lumber prices and strong housing demand, even as the housing sector continues to grapple with building material supply chain issues and labor challenges, the National Association of Home Builders reported.
According to the latest in a series of monthly NAHB/Wells Fargo Housing Market Indexes, released yesterday, builder sentiment in the market for newly built single-family homes edged up one point, to 76, in September, ending a three-month decline, the NAHB said.
“Builder sentiment has been gradually cooling since the HMI hit an all-time high reading of 90 last November,” said NAHB Chairman Chuck Fowke. “The September data show stability as some building material cost challenges ease, particularly for softwood lumber. “However, delivery times remain extended, and the chronic construction labor shortage is expected to persist as the overall labor market recovers.”
“The single-family building market has moved off the unsustainably hot pace of construction of last fall and has reached a still hot but more stable level of activity,” added Robert Dietz, chief economist for the Washington, DC-based NAHB. “While building material challenges persist, the rate of cost growth has eased for some products, but the job openings rate in construction is trending higher.”
The NAHB said it expects housing affordability will be a key demand-side challenge in the coming quarters, given the rapid rate of growth for home prices and construction costs over the last year.