Builder Confidence Rose 3 Points to 37 in May

Washington, DC, May 18, 2026-Builder confidence in the market for newly built single-family homes increased three points to 37 in May, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).

“The housing market remains soft as higher mortgage rates, rising gas prices and economic uncertainty related to the war in Iran continue to dampen buyer demand,” said NAHB chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. “However, efforts in the House to modify the 21st Century ROAD to Housing Act could increase the nation’s housing supply and help ease builder concerns.”

“Recent increases for long-term interest rates will continue to hold back home buyer demand,” said NAHB chief economist Robert Dietz. “Although some regional markets, including parts of the Midwest, are showing relative strength, the housing market continues to face significant affordability challenges.”

The latest HMI survey also revealed that 32% of builders cut prices in May, down from 36% in April. The average price reduction was 6%, up from the 5% figure in April. The use of sales incentives was 61% in May, up slightly from 60% in April, and marking the 14th consecutive month this share has reached 60% or higher.

All three of the major HMI indices posted gains in May, as some buyers who had been holding back decided to move forward this spring. The HMI index gauging current sales conditions rose three points to 40 from April to May, the index measuring future sales increased three points to 45 and the index charting traffic of prospective buyers posted a three-point gain to 25.

Looking at the three-month moving averages for regional HMI scores, the Midwest registered a one-point gain to 43, the Northeast rose one point to 42, the South held constant at 35 and the West fell one point to 28.