Confidence among US homebuilders rose this month by the most since early 2024, boosted by lower mortgage rates that are chipping away at the nation’s affordability problem.

An index of market conditions from the National Association of Home Builders and Wells Fargo increased 5 points in October to 37, the highest since April. A value below 50 means more builders see conditions as poor than good. Economists surveyed by Bloomberg estimated sentiment would tick up slightly to 33.

“While recent declines for mortgage rates are an encouraging sign for affordability conditions, the market remains challenging,” NAHB Chairman Buddy Hughes said in a statement Thursday. “Most home buyers are still on the sidelines, waiting for mortgage rates to move lower.”