Builder sentiment rose four points to 48 in February; anything below 50 is considered negative for the National Association of Home Builders’ monthly survey, according to NAHB. It reached a record high of 90 in November 2020.
All three components of the homebuilder index increased, with sales expectations in the next six months climbing three points to 60; current sales conditions rising four points to 52; and buyer traffic increasing four points to 33.
“While mortgage rates still remain too high for many prospective buyers, we anticipate that due to pent-up demand, many more buyers will enter the marketplace if mortgage rates continue to decline this year,” said NAHB Chairman Alicia Huey.
Twenty-five percent of builders reported cutting prices in February, which is down from 31% in January. The average price discount is holding at 6%. Additionally, 58% of builders provided sales incentives of all types in February, which is down from 62% in January.
