For the first time in four months, builder confidence in the future of the housing market has declined. Although the drop was by a single point, it signals a shift in the industry that is facing rising construction costs and labor challenges. The National Association of Home Builders/Wells Fargo Housing Market Index posted a reading of 83 in January, down from 84 in December.
“Higher material costs and lack of availability are adding weeks to typical single-family construction times,” said NAHB Chairman Chuck Fowke. He notes that the cost of residential construction materials has risen nearly 19 percent since December 2020.
Despite this, the report cites that builders remain confident that demand from buyers will remain high in the coming months.
Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 3.0 percent and 15-year rates are near 2.25 percent.
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