A lack of affordability and buyer hesitation stemming from elevated interest rates and high home prices contributed to a decline in builder sentiment in August. Builder confidence in the market for newly built single-family homes was 39 in August, down two points from a downwardly revised reading of 41 in July. …Challenging housing affordability conditions remain the top concern for prospective home buyers, as both present sales and traffic readings showed weakness. However, with current inflation data pointing to interest rate cuts from the Federal Reserve and mortgage rates down markedly in the second week of August, buyer interest and builder sentiment should improve in the months ahead. …The HMI index charting current sales conditions in August fell two points to 44 and the gauge charting traffic of prospective buyers also declined by two points to 25. The component measuring sales expectations in the next six months increased one point to 49.