In November of 2022, 36% of single-family home builders reported reducing their prices, and 59% were offering special sales incentives. These percentages may seem relatively high—and in fact they have increased significantly since July of this year—but they are nowhere near as high as they were during the 2007-2008 financial crisis, the National Association of Home Builders reports.
Questions on sales incentives have been a regular topic on the monthly survey for the NAHB/Wells Fargo Housing Market Index (HMI) since the 1990s. The questions on price reductions were introduced during the financial crisis and have been revisited several times since then.
In July of 2022, 13% of builders reported that they had reduced home prices during the past month to bolster sales volume and/or limit cancellations. This subsequently increased to 19% in August, 26% in September, and 36% in November. Even at 36%, however, the current percentage doesn’t seem terribly high compared to May 2007 through March of 2008, when the share of builders cutting prices was consistently 48% of higher—as high as 59% in October of 2007.