Strong buyer demand helped to offset supply-side challenges relating to building materials, regulation and labor as builder confidence in the market for newly built single-family homes inched down one point to 80 in July, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
"Builders continue to grapple with elevated building material prices and supply shortages, particularly the price of oriented strand board, which has skyrocketed more than 500 percent above its January 2020 level," says Chuck Fowke, NAHB chairman. "We are grateful that the White House heeded our urgent plea to hold a building materials meeting with interested stakeholders on July 16 to seek solutions to end production bottlenecks that have harmed housing affordability."
"Builders are contending with shortages of building materials, buildable lots and skilled labor as well as a challenging regulatory environment. This is putting upward pressure on home prices and sidelining many prospective home buyers even as demand remains strong in a low-inventory environment," says Robert Dietz, NAHB chief economist.
The three major HMI indices were mixed in June. The HMI index gauging current sales conditions fell one point, the component measuring traffic of prospective buyers dropped six points and the gauge charting sales expectations in the next six months posted a two-point gain.
