Slower New Home Market May Benefit Buyers

Each month, the National Association of Home Builders conducts a survey to gauge builders’ perceptions of the current market for newly built single-family homes. Their monthly measure of home builder confidence is a closely watched housing market indicator, as home builders have a unique perspective on the market. In November, builder confidence fell from the month before. Jerry Konter, NAHB’s chairman, says higher mortgage rates have slowed demand. “Higher interest rates have significantly weakened demand for new homes as buyer traffic is becoming increasingly scarce,” Konter said. But slower demand may hold benefits for buyers still active in the market. According to the survey, more builders say they’re now offering incentives in an effort to bring in buyers. In fact, among participants, 59 percent said they’re using incentives – including paying points and mortgage-rate buy downs. An increasing number of builders also report lowering prices in November, with an average price reduction of 6 percent. (source)

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