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    Analysis

    July 20, 2021

    NAHB: Supply-Side Challenges Weighing on Builder Confidence

    Written by David Schollaert

    Builder confidence slip modestly in July on high raw material costs and a shortage of skilled labor, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). The index edged down one point to a reading of 80 last month. The dip in the index – a measure of builder confidence in the new single-family home market – reflects a continued slow decline from record-highs earlier in the year.

    Sustained demand from new home buyers continues to offset the impact of the industry’s struggles, particularly supply-side challenges relating to building materials, regulation and labor. “Builders are contending with shortages of building materials, buildable lots, and skilled labor as well as a challenging regulatory environment,” said NAHB chief economist Robert Dietz. “This is putting upward pressure on home prices and sidelining many prospective home buyers even as demand remains strong in a low-inventory environment.”

    David Schollaert

    David Schollaert is deputy editor-in-chief for Steel Market Update. David joined SMU after more than a decade in the metals and mining industry in a myriad of different roles. Much of his early experience and expertise were within the coverage and analysis of steel-making raw materials and served previously as senior editor of the CRU Prices Service. Most recently, however, before his return to market analysis, David held roles as a metals buyer and an operations manager for raw material suppliers. He can be contacted at david@steelmarketupdate.com or 724-720-1008.

    Read more from David Schollaert

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