More builders are lowering prices for homes as their confidence in the market continues to tumble.
Homebuilder sentiment in September fell 3 points to 46 in the National Association of Home Builders/Wells Fargo Housing Market Index. Anything below 50 is considered negative.
That is the ninth straight month of declines and the lowest level since May of 2014, with the exception of a short-lived drop at the start of the coronavirus pandemic in 2020. Sentiment was at 83 in January of this year, when interest rates were about half of what they are now.
Indeed, builders blame rising rates for their falling sentiment. The average on the 30-year fixed started this year around 3% and then began rising steadily, crossing 6% for a few days in June, according to Mortgage News Daily. It then fell back a bit and almost hit 5% in August, before rising sharply again, back over 6% this month. That made an already pricey housing market even less affordable. The Federal Reserve, meanwhile, is expected to again raise its benchmark rate this week as inflation remains high.