The coldness in the US real estate market has not dissipated, and builder confidence has dropped for two consecutive months to its lowest point of the year.

The high mortgage rates, rising costs of land and construction materials, and other factors have dragged down the confidence of American home builders for the second consecutive month, falling to the lowest level this year. At the same time, the number of signed contracts for existing homes in June in the US also significantly declined, showing that the high costs of housing are still suppressing demand in the real estate market. Data released on Thursday by the National Association of Home Builders (NAHB) and Wells Fargo Bank shows that the July home builders' confidence index dropped 2 points to 34, below the market's expected 35. A reading below 50 indicates that more builders view the market conditions as poor rather than good. The index has been below 40 for 15 consecutive months since last year, marking the longest record since 2012. NAHB's chief economist Robert Dietz stated that housing affordability remains the primary challenge facing the residential construction industry. High mortgage rates, expensive land prices, rising construction material costs, and a continuing shortage of skilled labor are all putting pressure on the market. Another set of data released on Thursday showed that the pending home sales index in the US for June dropped by 5.4% to 72.5 compared to the previous month, significantly weaker than economists' expected decline of 0.5%, further reflecting a soft housing demand. In recent years, the 30-year fixed mortgage rates in the US have remained above 6%, combined with uncertainties in the Middle East, tariff policies, and unclear job market prospects, new home sales have been under pressure this year. Looking at the sub-indexes, all components of the July home builders' confidence index, including current sales, future sales expectations, and prospective buyer foot traffic, showed declines. To attract buyers, more and more builders have had to offer incentives, but this has also squeezed profit margins and weakened the willingness of companies to continue construction. Data shows that 63% of builders in July reported offering sales incentives, higher than 62% in June; and 37% said they have lowered prices, higher than 35% in the previous month. Regionally, the Northeast saw the sharpest decline in home builders' confidence, dropping 9 points to 41, the largest decline since November of last year. The South, after a significant decline in June, remained unchanged this month; confidence in the West continued to decline, while the Midwest saw a slight rebound. The US federal government will release data on new home construction and residential building permits for June on Friday, further observing the impact of a high-rate and high-cost environment on housing supply.