More home builders are feeling confident about the current and future housing market this month according to a survey out today from the National Association of Home Builders. Home builder sentiment ticked up slightly in December for the third month in a row. But the majority of builders are still feeling down. Two-thirds said they've had to offer incentives lately to get buyers to commit, including 40% who have lowered prices.

It’s been a slow year for Justin Wood’s company, Fish Construction Northwest in Portland, Oregon. Although, it’s ending better than it started.

“We’ve sold three homes in the last month and a half, which has picked up our activity a little bit. And so, we're kind of hoping that continues into next year,” Wood said.

Wood typically sells about 15 homes a year, mostly townhomes in the city. This year, he’s dropped prices, offered money toward closing costs, and lately he’s been trying something new to make sales: making homes energy efficient, but not charging extra.

“Literally just saying, ‘Hey, the house comes with solar, it's free, it's included,’” Wood said.

So many builders have been offering incentives that Robert Dietz at the National Association of Home Builders said it has contributed to a noticeable split in the trajectory of new home prices versus existing home prices.

“Existing home prices have continued to increase since 2022, but median new home prices are down more than 10%. And that's the accumulation of those incentive factors to try to deal with the challenge of housing affordability,” he said.

Affordability is the biggest factor weighing on prospective buyers. Clint Mitchell sees that in Indianapolis, where he owns Estridge Homes. They sell about 100 houses a year for anywhere between $500,000 and $2 million.

“For us, the higher price point has done reasonably well this year, it's our lower price point that has been much slower. It seems like that consumer is more stretched, more strained,” Mitchell said. 

Although, just like for Justin Wood, Mitchell said his sales the last couple of months have been stronger.

“It’s actually been some of our better months of the year,” he said.

So, he is heading into 2026 feeling cautiously optimistic.