Home Builders Cut Prices Amid Declining Buyer Interest
Home-builder confidence dropped to a one-year low in September, according to the National Association of Home Builders (NAHB). A growing number of builders are reducing prices on new homes as buyers remain hesitant due to high mortgage rates. The NAHB survey revealed that 38% of builders cut prices last month — up from 35% in August and the highest share since January 2026, with an average discount size remaining at 6%. Additionally, 66% used sales incentives like free appliances or rate buydowns to attract buyers. Builders are also facing rising construction costs for land, labor, and materials. Tight lending conditions further complicate expansion plans, as nearly half of builders reported difficulty acquiring new land plots. The housing market remains under pressure with a 30-year mortgage rate reaching 7.22%, the highest in two years, contributing to stagnant demand. The imbalance between sellers and buyers has widened significantly — Redfin estimates there were 58% more sellers than buyers in August, marking one of the largest gaps since tracking began.
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Topics: Builder confidence Home builders Mortgage rates Price cuts