U.S. homebuilders are thrilled with demand for housing, but they say they are being hamstrung by rising costs for lumber.
Builder sentiment fell 2 points to 68 in June, according to the National Association of Home Builders/Wells Fargo Housing Market Index. The index stood at 66 last June. A reading above 50 is considered positive sentiment.
Builder sentiment has been mostly in the 70s since December, except for one dip in April, when mortgage rates took a sizable jump. This time, the weakness is all about the spike in material prices.
"Builders are optimistic about housing market conditions as consumer demand continues to grow," said NAHB Chairman Randy Noel, a custom homebuilder from LaPlace, Louisiana. "However, builders are increasingly concerned that tariffs placed on Canadian lumber and other imported products are hurting housing affordability. Record-high lumber prices have added nearly $9,000 to the price of a new single-family home since January 2017."