<div id="readability-page-1" class="page"><div> By Jessica Coacci Confidence among U.S. home builders improved in May but still remains in negative territory amid rising mortgage rates, elevated costs and economic uncertainty tied to the war in Iran. Here are the main takeaways from the National Association of Home Builders' latest report released Monday: The NAHB/Wells Fargo Housing Market Index, a gauge of builder confidence in the market for newly built single family housing, increased to 37 in May from 34 in April. Economists polled by The Wall Street Journal expected a reading of 34. The reading below 50 means builder perceptions of current sales and sales expectations are net negative. &#34;The housing market remains soft as higher mortgage rates, rising gas prices and economic uncertainty related to the war in Iran continue to dampen buyer demand,&#34; said NAHB Chairman Bill Owens, a home builder and remodeler from Worthington, Ohio. The latest HMI survey also revealed that 32% of builders cut prices in May, down from 36% in April. The average price reduction was 6%, up from the 5% figure in April. The use of sales incentives was 61% in May, up slightly from 60% in April, and marking the 14th consecutive month this share has reached 60% or higher. &#34;However, efforts in the House to modify the 21st Century ROAD to Housing Act could increase the nation's housing supply and help ease builder concerns,&#34; Owens added. All three of the major HMI indices posted gains in May, as some buyers who had been holding back decided to move forward this spring, the survey said. Write to Jessica Coacci at jessica.coacci@wsj.com <pre></pre> (END) Dow Jones Newswires May 18, 2026 10:14 ET (14:14 GMT)Copyright (c) 2026 Dow Jones &amp; Company, Inc.</div></div>

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U.S. builder sentiment improved in May, with the NAHB/Wells Fargo Housing Market Index rising to 37 from 34. Despite this, confidence remains negative due to high mortgage rates and economic uncertainty from the war in Iran. 32% of builders cut prices, with an average reduction of 6%. Sales incentives were used by 61% of builders. Efforts to modify housing legislation may help increase supply and alleviate builder concerns.

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U.S. Builder Sentiment Improved in May But Affordability Challenges Persist