Builder Confidence Fell 3 Points to 29 in October

Washington, DC, October 19, 2026—Builder confidence in the market for newly built single-family homes fell three points to 29 in October, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) released today. The reading was the lowest since June 2012.
“Mortgage rates have climbed well above 7% in recent weeks, and higher gas prices and inflation have further weakened buyer traffic across much of the country,” said NAHB chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. “Though builders are also contending with higher costs for construction loans, building materials and diesel, the Trump administration’s efforts to advance regulatory reform are helping to ease some of the cost pressures they face. Nationwide, more than one-third of builders reported immigration enforcement activity in their market areas during the past month, causing construction delays and discouraging legal workers from reporting to work.”
“Housing remains squeezed by supply-side constraints and significant affordability challenges,” said NAHB chief economist Robert Dietz. “Demand persists, but higher mortgage rates, elevated construction costs and weaker consumer confidence are keeping more buyers on the sidelines. As a result, buyer traffic has fallen to its lowest level since April 2012, excluding the pandemic’s onset in April 2020.”
The latest HMI survey found that 43% of builders cut prices in October, the highest share during the 2020-2026 period. The average price cut remained at 6% for the seventh consecutive month. Meanwhile, 65% of builders reported using sales incentives in October, the 19th straight month at least 60% of builders have done so.
All three of the major HMI indices posted losses in October. The index measuring current sales conditions fell two points to 33, the index gauging future sales expectations dropped five points to 32 and the index charting prospective buyer traffic fell five points to 18.
Looking at the three-month moving averages for regional HMI scores, the Northeast dropped one point to 38, the Midwest fell three points to 40, the South fell one point to 30 and the West posted a two-point decline to 26. The Midwest is a relatively bright spot for single-family home building, with permits up 2.9%