The nation's homebuilders are feeling better about their business, as falling mortgage rates help more buyers afford homes. They are still not, however, building enough homes to meet demand. That has less to do with buyer demand and more to do with the larger economy.
Builder confidence for single-family homes rose one point to 66 in August, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index .
The nation's homebuilders are feeling better about their business, as falling mortgage rates help more buyers afford homes. "Even as builders report a firm demand for single-family homes, they continue to struggle with rising construction costs stemming from excessive regulations, a chronic shortage of workers and a lack of buildable lots," said NAHB Chairman Greg Ugalde, a homebuilder from Torrington, Connecticut.
"While 30-year mortgage rates have dropped from 4.1% down to 3.6% during the past four months, we have not seen an equivalent higher pace of building activity because the rate declines occurred due to economic uncertainty stemming largely from growing trade concerns," said NAHB Chief Economist Robert Dietz. "Although affordability headwinds remain a challenge, demand is good and growing at lower price points and for smaller homes.
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