The BTIG/HomeSphere Homebuilder Survey for March, which canvassed 103 small- and mid-sized tract and custom homebuilders across the United States, registered a broad softening in demand metrics compared with February.
Sales and traffic trends
Thirty-five percent of respondents reported lower year-over-year sales in March, up from 23% in February. Traffic trends shifted sharply: 33% of builders said they saw higher year-over-year traffic in March, down from 43% in February, while 35% reported lower traffic versus 18% the prior month.
Business versus expectations
Sentiment versus expectations weakened as well. In March, 26% of survey participants described sales as better than expected, down from 33% in February. For traffic, 24% reported results were better than expected, a decline from 40% in February.
Pricing and incentives
Pricing pressure showed up in the form of modest base-price reductions and greater use of incentives. Twenty-three percent of builders said they lowered some, most, or all base prices in March, up slightly from 21% in February. Use of incentives increased, with 24% of respondents reporting they had increased some, most, or all incentives compared with 18% in February.
Builder commentary and BTIG interpretation
Builders contributing commentary to the survey turned more cautious in March. Multiple respondents across regions pointed to the conflict in Iran, rising gasoline prices, and re-accelerating mortgage rates as factors weighing on both sales and traffic. BTIG characterized the deterioration across sales, pricing, traffic, and expectations as evidence that higher rates and price pressures related to the Iran conflict have damped demand, reversing improvements observed in January and February.
Context and limitations
The survey results are drawn from 103 small- and mid-sized tract and custom homebuilders nationally. The data reflect respondents' reports for March and direct month-to-month comparisons with February as cited above. Where the survey shows weakening across multiple metrics, the underlying commentary highlights specific concerns identified by participating builders.