The feelings of building home decrease in February amid the concerns of tariffs

Feelings between home builders in one nation decreased to the lowest level in five months in February, due significantly to the definitions, which may significantly raise their costs.

The National Housing Market Index for Home Builders, or HMI, dropped 5 sharp points from January to 42. Anything less than 50 is considered negative. Last February, the index reached 48.

“While the builders reserve hope in the policies of pro -development, especially with regard to organizational reform, the uncertainty in politics and cost factors created a re -assignment of 2025 forecasts in the latest HMI “.

Of the three components of the index, the current sales conditions decreased 4 points to 46, the buyer’s movement decreased 3 points to 29, and sales forecast decreased in the next six months 13 points to 46. This last component reached its lowest level since December 2023.

Builders are already facing high mortgage rates. The average of a 30 -year -old mortgage rate was more than 7 % for January and February, after it was earlier in a range of 6 %. Home prices are also higher than they were a year ago, which weakens the ability to withstand costs.

While President Donald Trump’s tariff for Canada and Mexico, which originally suggested to enter in early February, was delayed about a month, the builders still expect higher costs.

“With 32 % of devices and 30 % of soft woods coming from international trade, uncertainty about the scope and scope of definitions may have caused more attention to builders than costs,” said Robert Dietz, NAHB chief economist.

Feelings of building home have gained steadily since August to expect decrease in mortgage rates, and the builders have noticed potential development policies. The beginnings of housing in one family are heading to less than a year ago, although there are meager supplies for the current homes offered for sale.

The decrease in building morale, coming immediately before the very important spring market, indicates that the supply is less in the market. Many home builders have noticed the decline in the demand for the buyer in the recent profit reports.

“Despite the federal reserve procedures to reduce interest rates in the short term, the mortgage interest rates remained high in the fourth quarter, which affected the buyer’s request as the buyer continued to face capacity challenges To bear the costs. ” It is released.

The price share of prices fell to 26 % in February, a decrease from 30 % in January and the lowest share since May 2024. Other sales incentives decreased.

This may be because incentives have become less effective in attracting buyers, because high prices and high rates have reduced the group of buyers who move these benefits from the needle, according to NAHB.

When the buyer is priced strongly, no incentive helps, and with the rates surviving, the group of marginal buyers may shrink. Providing incentives to buyers who will buy regardless of prices or prices in terms of the declining value of builders.