US home developers are increasingly anxious as rising mortgage rates and cost-of-living strains deter buyers. New home construction has stalled compared with early 2026, and developer sentiment is darkening. After the Federal Reserve raised interest rates, Lennar Corporation reported a 40 per cent plunge in adjusted earnings for its third quarter. New orders fell 9.2 per cent year-on-year, and delivery dollar values dropped 6.1 per cent.

CEO Stuart Miller said fewer families can afford a down payment and mortgage. The average 30-year mortgage rate is now 6.95 per cent, up from 6.16 per cent in January. Single-family housing starts averaged 891,000 units in August, down from 923,000 in January and over 1mn in early 2025. Homebuilder sentiment fell to 32 in September from 35 in August, the lowest in a year.

Jeff Hemme of Hemme Construction in central Missouri is building half as many spec homes. The S&P 500 homebuilding sub-index is down about 9.8 per cent this year; Lennar shares are down over a quarter, while DR Horton fell 4.2 per cent. Analysts warn high borrowing costs and slower supply will worsen affordability.