US Homebuilder Sentiment Plunges to 29 in October Amid High Borrowing Costs

U.S. homebuilder sentiment dropped to 29 in October from 31, reaching its lowest level since June 2012. The National Association of Home Builders/Wells Fargo index weakened across all components as the average 30-year fixed mortgage rate climbed to 7.40%, approaching 7.5%. Buyer traffic tumbled five points to 18, reaching its lowest mark since 2012 outside the initial pandemic shock. Current sales slipped to 33 while six-month sales expectations dropped to 32. In response, a survey-record 43% of builders cut home prices, averaging 6% discounts, while 65% offered sales incentives.