Crisis of mistrust between US construction companies

US single-family homebuilder confidence fell for a record twelfth straight month in December as a rush to offer incentives to potential homebuyers failed to boost traffic, this against a backdrop of high inflation and interest rates. high interest.

At the start of a week of key reports on the health of the US housing market, the National Association of Home Builders reported that its Home Market Index (NAHB/Wells Fargo) fell two points to 31 this month, from 33. November points. A reading above 50 indicates that conditions are good.

With the exception of the brief dip during the spring of 2020, when the country went into lockdown from the first wave of Covid-19, the December reading was the lowest since June 2012 (29 points).

The housing market is the sector that sees the most pronounced effects of the aggressive rate hikes by the Federal Reserve. In October, home loan rates topped 7%, the highest level since 2001, while new and existing home sales plunged more than 30% between January and October.

The NAHB noted that nearly two-thirds of builders offer incentives, such as mortgage rate rebates, paying buyers points and price reductions. While the percentage price reduction was reduced to 35%, the average discount offered increased to 8% from 5 and 6% at the beginning of the year.

However, there are signs that the decline in builder confidence is bottoming out, as the indicator of sales expectations for the next six months rose four points to 35.