National Association of Home Builders CEO Jerry Howard said the organization's new numbers on home builder confidence show not much has changed since February, but errs on the side of caution around the industry.
"We always start to get better as spring comes and the building season approaches," Howard explained on FOX Business’ “Varney & Co. Monday” “But we still have issues with labor supply, we still have issues with the cost of building materials.”
Howard said some of the banks are also "getting tight" when it comes to administering loans to builders for acquisition, development, and construction lending - and rising costs for builders are being passed on to buyers.
“Six years ago, eight out of ten homes on the market were affordable by the average prospective buyer. Right now it's down to fifty percent.”
Starter homes are especially difficult to build, according to Howard, because currently the labor and supply costs are driving up home prices more than the average first-time buyer could afford.
Howard blames the increased cost on state and local governments over-regulating home construction, citing San Diego County, California, where up to forty percent of homebuilding cost goes into ensuring structures are up to code.