I sat down with Robert Dietz, the chief economist at the National Association of Home Builders. Twenty-one years into his career at NAHB, Robert has built a career translating what happens in Washington and on Wall Street into what actually happens on a job site in Houston or Anchorage or northern Virginia. That gap, between the headlines and Main Street, is where this whole conversation lives.
We started with his path, a kid who loved math and history, pulled toward economics after watching the 1992 election unfold, trained by mentors who trace straight back to the last two NAHB chief economists. He spent time on Capitol Hill working tax policy before landing at NAHB in 2005, right before the Great Recession hit. That timing shaped how he thinks about forecasting, and he’s honest about the misses. This year alone, a macro surprise involving Iran knocked the ten-year Treasury forecast off by fifty basis points. He compares the job to forecasting the weather, and he means it as a compliment to weather forecasters.
“The real benefit of my job, I travel every week. I go to an individual market. I just got back from Houston, had about 800, 900 people in a room. We did a forecast event. It’s really that ability to get up and say, ‘Here’s what we’ve analyzed, here’s where we’ve typed some numbers into a computer in Washington, DC.’
But to stand up in front of builders and say, ‘Here’s what we think,’ and then to have that kind of feedback, ‘No, you guys are wrong on this, you need to check yourself on that.’
That’s something that maybe an academic PhD doesn’t necessarily get on a week-by-week basis. It keeps you on your toes, and keeps you sharp.”
From there we got into the disconnect that builders feel every day, the sense that what’s on the news doesn’t match what’s happening in their own market. Robert breaks down why national new home sales numbers can be down while the Midwest is posting gains, why custom home building is climbing even as spec construction pulls back, and what that says about who can still afford to buy right now.
I brought up a lake community in Ontario where multimillion dollar homes get snapped up by international buyers while everything below that price point sits, and Robert connects it straight back to the stock market and who has access to cash.
“We face a lot of headline risk. Building and other kinds of real estate issues are hyper-local, and individual markets are not gonna be in sync with the macro cycle.
I’ll give you an example. Every year I travel to Anchorage, Alaska, and do a forecast event for Alaskan builders. The Alaskan market is not gonna be particularly correlated with some of the national headlines. So if the mood in New York and Washington is one of downbeat or pessimism, and then you go out to a particular market and they’ve got growth, there’s gonna be a pretty big disconnect, and that’s because all real estate is local.”
“The mood about home building is one of a soft market, a market that’s taking a breather. But there are definitely hot spots out there. New home sales in 2026 right now is down about 7%. You go out to the Midwest, new home sales in most markets are actually up. They’re up 6% to 7%. Custom home building this year is up 2% to 3%.”
Then we got into the part of the conversation I suspect a lot of builders will want to bookmark, his framework for why homes cost what they cost. He calls them the five Ls, and by the end of our talk he’s added a sixth. We walk through each one, labor, lots, lumber, lending, and the one he’s spent the last decade trying to get policymakers to take seriously, legal and regulatory burden. The numbers he shares on what that burden adds to the price of a single-family home are worth hearing in his own words, and they’ve grown since NAHB last measured them five years ago.
“For the last decade, we’ve been really trying to change the conversation about why we have a housing deficit, why there’s an affordability crisis. Traditionally, most housing economists would look at the demand side of the equation, and we’ve really tried to bring a spotlight to the supply side.
The issues that those builders are facing go back to what we’ve learned as we talk to builders, and the formulation was the five Ls, the limiting factors that limited supply. So a lack of labor, a lack of lots, issues with lumber, building materials, and the one that we’ve really tried to highlight over the last decade, which is legal and regulatory burdens.”
“The analysis indicated in 2021 research that we did that the typical newly built single-family home, about 24% of the price was made up in regulatory burdens, representing an all-in cost burden of about $93,000.
The team at NAHB released new research just last week that indicates that in 2026, we do this research every five years, that component is now 26% of the price of a typical single-family home, and in dollar terms is now above $130,000.”
We spent time on zoning too, on the difference between the people he calls NIMBYs and YIMBYs, and on a term he uses for the group he considers a lost cause. I told him about a builder I’m interviewing next who’s doing infill construction in Portland, and Robert had a guess about who that builder was before I even finished the sentence.
“We need to work with the YIMBY groups, the Yes In My Backyard movement that recognizes we need more construction, we need more supply. We need to convince some of the NIMBY forces, the Not In My Backyard forces, about the merits and the benefits of economic growth.
And I always like to say we need to just outright oppose the group I call the BANANAs, which are the Build Absolutely Nothing Anywhere Near Anything. The BANANAs are a lost cause. Focus on the NIMBYs and the YIMBYs.”
Robert also walks me through where he sees real momentum, townhouse construction gaining ground for fifteen years running, remodeling entering a genuine growth cycle, and why he’s more measured than some of the voices predicting a modular and 3D printing revolution overnight. We talked about capital, why builder loans carry interest rates that surprise even realtors, and whether smaller builders can hold their ground against the largest national builders.
“As I talk to remodelers, lots of bullish sentiment. Growth industry. They’re seeing growth. Homeowners have a lot of wealth. We’ve got an aging housing stock, and there’s gonna be a lot of aging in place among existing homeowners. That’s a growth sector that really has surprised me in terms of long run potential.”
Where the conversation goes next surprised me a little. Robert made the case for homeownership as something bigger than a financial transaction, tracing the idea back through ancient Greece, through Marx, through what happens to a society when ownership gets taken away from ordinary people. It’s a direction I didn’t expect an economist to take the conversation, and it’s one of my favorite stretches of the whole episode.
“A class of workers that don’t own anything, have no stake, and who are dependent on the government, that is the number one way to weaken a democracy. Representative citizen democracy is dependent on people owning things and investing in those things, and more importantly, investing in their children.
Whether it’s small business ownership or homeownership, those are the two critical ways we can do that, and it’s why I’m a big fan of small businesses and homeownership.”
We closed things out with a rapid fire round and a few personal questions, including what Robert would do with an hour to himself, the book and person he’d want to introduce me to, and whether there’s anywhere in his own story he’d go back and change.
“I feel like I’ve actually been very, very lucky. I’m doing kind of what I wanted to do when I was age 19. I have a great family, great friends. I work at a great organization at NAHB. I’m a lucky person, so I would not want to mess anything up.”
If you build homes, sell them, finance them, or just want to understand why the market feels the way it feels right now, this one’s worth your full attention.
About Robert Dietz
Dr. Robert Dietz is the Chief Economist for the National Association of Home Builders, where his responsibilities include economic forecasting, industry surveys, and policy research. He is commonly cited on CNBC, the Wall Street Journal, the Washington Post and NPR. He is the nation’s leading analyst of the residential construction industry.
Prior to joining NAHB in 2005, Robert worked as an economist for the Congressional Joint Committee on Taxation. He is a native of Dayton, Ohio and earned a Ph.D. in Economics from The Ohio State University in 2003.
NAHB’s economics blog: https://eyeonhousing.org
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