With mortgage rates hitting a 23-year high above 7%, builder confidence rates have dropped to the lowest point since January 2023.

 

According to the National Association of Home Builders (NAHB), builder confidence in the newly built single-family home market fell four points to 40 from a revised September reading. The NAHB/ Wells Fargo Housing Market Index (HMI) showed a three-month consecutive monthly drop.

"Builders have reported lower levels of buyer traffic, as some buyers, particularly younger ones, are priced out of the market because of higher interest rates," said NAHB Chairman Alicia Huey, a custom home builder and developer from Birmingham, Alabama.

In October, 32% of homebuilders reported cutting home prices, which is unchanged since September.