In an uncertain economy, positive signs can come in small increments.

A recent survey of builder sentiment reveals that confidence in the industry increased slightly in the month of March. The modest improvement in attitude occurred despite several negative trends working against the industry.

 The National Association of Home Builders (NAHB), in conjunction with Wells Fargo, released the most recent Housing Market Index (HMI) on March 16. The index is a monthly survey designed to gauge builder sentiment in the single-family housing market.

Builders are asked to rate three specific conditions of the housing market. They rate their sentiment on present sales of new single-family homes, expected sales of single-family homes for the next six months and traffic of prospective buyers of new single-family homes. Each is assigned a score that falls on a range between 0 and 100.

The three scores are also averaged to arrive at an overall score for the market. A score of 50 or greater signals that a majority of builders feel confident about the market. A lower score reflects less optimism among builders.

The HMI for March 2026 came in at 38. That is one point higher than the HMI for February, but well below the high of 90 reached in November of 2020. More recently, the index has been trending downward from a peak of 56 in July of 2023.

Within the average, each individual score also posted monthly gains. Sentiment about current sales conditions increased one point to 42. Sentiment about sales expectations in the next six months gained two points to 49. Finally, builders’ feelings about traffic of prospective buyers posted a monthly three-point increase to 25.

NAHB also notes that 37% of builders cut prices in March. That number is up slightly from 36% in February. 

The NAHB notes that several factors are working as a drag on the industry, including economic uncertainty, high interest rates and high costs for land, labor and materials.

“Affordability for buyers and builders remains a top concern,” said NAHB chairman Bill Owens in a March 2026 statement.