WASHINGTON, Aug. 15 (Xinhua) -- U.S. builder confidence for newly-built, single-family homes fell in August to an 11-month low due to tariff concerns, a leading industry report said on Wednesday.
The builder sentiment index fell one point to 67 in August, the lowest level since October 2017, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Any reading over 50 indicates that more builders view sales conditions as good, rather than poor.
"The solid economic expansion and firm job market should spur demand for new single-family homes in the months ahead," NAHB chief economist Robert Dietz said in a statement.
However, "builders continue to monitor how tariffs and the growing threat of a trade war are affecting key building material prices, including lumber," he said, adding these cost increases, coupled with rising interest rates, are putting upward pressure on home prices and contributing to growing affordability challenges.
NAHB Chairman Randy Noel also said that builders were increasingly focused on growing affordability concerns, "stemming from rising construction costs, shortages of skilled labor and a dearth of buildable lots."
Prices for fuel, metals and wood products used in construction posted double-digit increases in July from a year earlier, according to an analysis released by the Associated General Contractors of America, another builder association, earlier this month.
"Steel, aluminum and Canadian lumber are all subject to stiff new tariffs, with the prospect that prices will soon rise even more for these and other goods used in construction," said the association's chief economist Ken Simonson.
Association officials urged the Trump administration to "find less damaging ways to resolve trade disputes," as the new tariffs, as well as potential additional tariffs and countermeasures by U.S. trading partners, are putting new cost pressures on many construction firms.
