Confidence among builders in the US housing market tumbled more than expected in November to the lowest level in a decade as painfully high inflation and rising borrowing costs forced potential buyers to pull back.
The National Association of Home Builders/Wells Fargo Housing Market Index, which measures the pulse of the single-family housing market, fell for the eleventh consecutive month to 33, marking the worst stretch for the housing market since the survey launched in 1985.
Any reading above 50 is considered positive; prior to this year, the gauge has not entered negative territory since 2012, excluding a brief – but steep – drop in May 2020.
The index has fallen to half of what it was just six months ago, when it stood at 76. It peaked at a 35-year high of 90 in November 2020, buoyed by record-low interest rates at the same time that American homebuyers – flush with cash and eager for more space during the pandemic – started flocking to the suburbs.
November’s reading was below the median expectations among economists for a decline to 36 from last month’s recording of 38.
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