Homebuilders are increasingly turning to price cuts and incentives as economic uncertainty continues to weigh on buyer demand. In November, 41% of builders reduced prices, the highest share in five years, while nearly two-thirds used additional incentives such as mortgage-rate buy-downs. Builder confidence remains weak, held back by high inflation, volatile mortgage rates and lingering effects of the prolonged government shutdown, which disrupted key economic data releases. Industry leaders note that even with mortgage rates easing slightly, many buyers remain hesitant due to job-market concerns and broader financial uncertainty. As a result, single-family housing starts are now expected to fall below last year’s level, with only modest improvement forecast for 2026.
Private-sector data paints a mixed picture of the housing market during this period of disrupted federal reporting. Mortgage Banker Association estimates show new-home sales jumping to their highest pace in over a year in October, boosted by lower mortgage rates, builder incentives and growing inventory. However, Home Depot’s latest earnings report signals ongoing strain in the home improvement sector, with the company citing soft consumer demand and continued housing market pressures. While some indicators suggest buyers may be re-entering the market, the overall backdrop remains one of caution as builders navigate a softer labor market and stretched consumer finances.
