By Joshua Kirby

Confidence among U.S. home builders fell again in November, marking a fourth straight month of decline as high mortgage costs continue to weigh on demand for houses, according to a report from the National Association for Home Builders released Thursday.

Here are the report's main takeaways:

--The NAHB's housing-market index, in conjunction with Wells Fargo, a gauge of builder confidence in the market for single-family housing, dropped six points to 34 from 40 the previous month. High mortgage rates are continuing to squeeze builder confidence and demand, which hit their lowest level in nearly a year, NAHB said.

--The reading was worse than the unchanged level expected by economists, according to a poll compiled by The Wall Street Journal.

--In November, 36% of builders reported cutting home prices, rising from 32% in October. Some 60% reported putting in place sales incentives of some kind, down slightly from a month earlier.

--Prospective buyers are being priced out of the market, dispiriting builders, NAHB Chair Alicia Huey said. "The rise in interest rates since the end of August has dampened builder views of market conditions," she said.

-- "Moreover, higher short-term interest rates have increased the cost of financing for home builders and land developers, adding another headwind for housing supply in a market low on resale inventory," Huey said. "While the Federal Reserve is fighting inflation, state and local policymakers could also help by reducing the regulatory burdens on the cost of land development and home building, thereby allowing more attainable housing supply to the market."

--All three major components of the housing-market index declined in November. The index gauging current sales conditions fell six points to 40, that charting sales expectations in the next half-year dropped five points to 39, and the measure of traffic of prospective buyers slid five points to 21, NAHB said.


Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby


(END) Dow Jones Newswires

11-16-23 1014ET