Marketplace - What's with the uptick in homebuilder incentives?

Episode Date: June 19, 2026

As high interest rates tamp down homebuying demand, more homebuilders are offering free appliances or upgraded hardware to sweeten the deal. Throwing in a free dishwasher is one thing, but how are they able to offer lower mortgage interest rates? In this episode, we check on the homebuilding sector. Plus: Hotel housekeepers say AI-driven app makes work more difficult, scientists design sunshades built for space, and a “talking book” nonprofit brings news and books to blind people.Every story has an economic angle. Want some in your inbox? Subscribe to our daily or weekly newsletter.Marketplace is more than a radio show. Check out our original reporting and financial literacy content at marketplace.org — and consider making an investment in our future.Read the stories from today’s episode:Builders offer incentives to attract homebuyers as high interest rates persistNebraska nonprofit brings local news and opportunities to blind and low-vision listenersMore stress, fewer breaks: Hotel housekeepers reveal what it’s like working for an appA climate change solution from science fiction

The economy is changing at a dizzying rate. Entered the chart topping and critically acclaimed managing the future of work podcasts from Harvard Business School hosted by me, Bill Kerr, and by managing the future of work project co-chair, Joe Fuller. The show explores workforce development, technology trends, demographic changes, and many other forces transforming the landscape of work. Follow the HBS Managing the Future of Work podcast wherever you get your podcasts. On the show today, signals or not from the new Fed chair, the economy post-Iran deal, and an out-there idea to cool the planet from space.

From American public media, this is Marketplace. In Denver, I'm Amy Scott in for Kai Risdahl. It's Friday, June 19th. Happy Juneteenth. It was a big week for the Federal Reserve. Kevin Warsh's first interest rate meeting as chair, followed by his first press conference, at which he set a decidedly different tone with me to talk about what we might expect from the new Fed chair and the rest of the week's economic news are Stacey Vanek-Smith with Bloomberg and Jordan Holman at the New York Times. Thanks for joining us. Thanks, Amy. Thanks, Amy.

All right, Stacey, let's start with you. What did you make of that first press conference? Anything stand out to you? Oh, yeah. Well, I mean, everyone was watching this press conference to see what Warsh was going to say. If he was going to deliver on what Trump really wants him to deliver on, which is lowering interest rates. And I think the answer is a definitive no. I think Warsh kind of came out as a hawk in this first press conference. We'll talk more about that. But Jordan, what about you? What does the beginning of the Kevin Warsh era look like just based on these initial statements and appearances? Yeah, you know, I spend most of my time talking to executives. And so they were also very much watching to see what to make of how they're planning their businesses and the fact that he did keep the interest rate high. It's kind of more of the same for them, which is more of the same of trying to figure out a complex economy, what's happening with the consumer.

And that's just something that's going to continue to play out in this economy. Okay. So, Stacey, one change that we got here was. was no guidance, basically. Kevin Warsh doesn't want to tell us where he thinks the Fed might be headed on interest rates. But we do have the dot plot, right, that shows where FOMC members anonymously think interest rates are headed. And as I think you alluded to, the markets really took those predictions to mean that we will see at least one increase in interest rates this year. You know, is that the right read, do you think? I do think that's the right read, yes. And I think the dot plot famously, or since Bernanke, through Yellen and Jerome Powell, I feel like the Federal Reserve has been moving towards more and more transparency and openness. And I think Warsh was delivering a message. He did not participate in the dot plot, we think. He's delivering a message that things are just going to be a little more secretive, a little more kind of behind closed doors. But he did give us one really big hint, which was he

said, you know, quote, this committee will deliver on price stability, which is essentially Fed speak for we're not going to lower interest rates. But I do actually think even if he came in planning on lowering interest rates, that does seem like an appropriate response to this moment because jobs have looked stronger in the last couple months and inflation has looked higher. So both of those things would be conducive to raising interest rates. So I don't know what his initial plans were, but it seems like he's definitely moving in a hawkish direction. Okay, so Jordan, you know, for those of us who watch the Fed closely, all this is super fascinating. We're always reading the fine print and interpreting body language. But what do you

think this leadership change means to the average person or to the business leaders that you talk to? Yeah, I mean, obviously, whatever the Fed does gives them, gives business leaders, and thus, us consumers who are purchasing their wares or going to their, uh, restaurants and whatnot. It gives a roadmap for just possibly how expensive things will be. Should we invest now? Should we not invest now? And when we think about what's really driving the economy, it's really the stock market. And so all of this is important to just think about the next three, six months or a year of what our economy and spending could be. And so when I'm talking to executives, this is just another data point that they're putting together

as well as like supply chain and thinking about the disruption from the war, all of those things to just think about what business, what their business will look like, and thus how they price things for us, what they offer us, all of that. So it's very important, but it's just one data point that business leaders are looking at. All right. So the big cloud hanging over the economy for the past 100 days or so has been the war in the Middle East. Stacey, we've got this tenuous deal now with Iran,

which was looking a bit shaky, you know, even today before Israel and Hasbola agreed to a new ceasefire. But, you know, compared to before the war and where we are now, how would you characterize the economic impact? I mean, it was huge. Obviously, fuel prices went up, you know, double-digit percentages. We've all seen this change at gas stations, but also fertilizer prices rose, which has pushed up food pricing. So I think everyone is hoping that this ceasefire will deliver lower price, that it will hold and it will deliver lower prices for lower gas prices, lower food prices, which is the kind of thing that can really trickle through the economy. But that is also not certain. Even if the Strait of Hormuz closing and fuel prices rising triggered the inflationary rise, I think we all remember transitory inflation, which was kicked up by supply chain. snags during COVID, even when the supply chain snags went away, the inflation didn't. So I think that is

what everyone, including Kevin Warsh, is watching right now. And Jordan, you know, we've talked about how the economy has held up, you know, maybe surprisingly well given all of that. And the latest retail sales numbers this week seem to back that up. How are consumers managing to keep carrying this economy, even with the higher prices that Stacey was talking about? Right. Well, I think the context around these retail cells, which cover May, it was tax refund season. And also is the start of the summer travel season. And so when I was chatting with some CEOs in the hospitality space and even think about like Airbnb, and you've already set your plans. So that means you're getting your clothes, whatever electronics you need. So that is kind of set. I think one of the

questions is, does it continue during the summer? Because the Stacey said, just because we get the deal now, it doesn't mean everything goes back. Prices will still probably be elevated for airline flights, food costs are higher, and then consumers will have to start really thinking about tradeoffs. But right now, what we saw with the retail sales might have been a moment in time with that elevated boost of tax refunds. All right. Jordan Holman with the New York Times and Stacey Vanek Smith with Bloomberg. Thanks both of you for joining us and hope you have a good weekend. Thanks, Amy. Me too.

U.S. markets were closed for the holiday, but we'll have some other numbers for you when we get there. Bring housing market can best be characterized as mixed. High prices and high mortgage rates are still keeping many would-be buyers out. And while sales of existing homes picked up in May, the market for new builds is struggling a bit. We learned this week housing starts, that is, new construction fell sharply last month.

And in April, sales declined after steady growth since January, which explains why, according to the National Association of Home Builders, nearly two-thirds of builders are offering incentives. Marketplaces Nova Sappho has more. Kara Lavender at John Burns Research and Consulting surveys about 300 builders monthly. And she says incentives are now averaging about 7% of the asking price for a property, about twice the pre-COVID average. So incentives can be a range of things, right? Things like design options spend. So getting $50,000 or $50,000 or whatever it may be to spend in the design studio. To customize a new home. Also, builder will do things like include appliances for free. So, you know, washers and dryers, dishwashers. Joel Burner is senior economist at Realtor.com. They'll do free upgrades on build-to-order homes. So if you want that quartz countertop or whatever it may be, The builder may include that at no cost just to get you to sign the deal.

Builders might also offer cash for closing costs, and they might, maybe, actually cut the asking price for a home, but only as a last resort, says Robert Dietz. He's chief economist at the National Association of Home Builders. When you artificially lower the price of a home, you're essentially disconnecting that price from construction costs and thus setting expectations. in the future that could be difficult to reverse. Often, lowering what the monthly payment will be is a key selling point, experts say. And one way builders have been doing that is by lowering the interest rates, buyers pay on mortgages, lower than what you'd get at a bank. Builders do this by essentially buying mortgages in bulk from a lender, says Ali Wolfe, chief economist at the housing data and consultancy firm, Zonda.

Put simply, they shell out a lot of money to then be able to, to offer these rates lower. That's not something you and I could do. That's only something that the builder can do because they have to put millions of dollars up front. All of this leaves potential buyers with a bewildering array of options. That is, if they can afford to take advantage of the deals in the first place. I'm Novosafo for Marketplace. Nonprofits tend to be pretty lean operations. IRS data from 2024 says 97% of them in the U.S. had annual budgets of less than $5 million. And well over half, we're working with $50,000 or less.

How these organizations stay afloat can be tricky, as you'll hear in the latest installment of our series, my economy. I'm Becca Jertie, executive director of Radio Talking Book Service. We read newspapers and magazines for folks who are blind, low vision, or otherwise print-impaired, and we broadcast those across the state in Omaha, Nebraska. I came to Radio Talking Book Service as a volunteer, but it was involuntary volunteering. I was convicted of a felony in 2012, and as a result had a fair amount of community service to complete, and they paired me with radio talking book service. In 2015, I wrapped up the hours and the volunteer coordinator approached me and said, hey, we have this part-time office summer gig paid. Would you be interested in applying? And I thought, yeah,

why not? I was at a bit of a crossroads. I was about three years sober. And I interviewed with the director at the time, and what he described was not going to be simply part-time, nor just a summer gig. Like, it was a rule that was going to be evolving. And I thought to myself, oh, man, I'm going to have to turn him down because I don't think this is for me. And he finally got done with his pitch, and he looked at me, and he said, what do you think? And I said, yeah, sounds great. Back in 2015, we were in that mid-200,000 a year kind of budget. That goes to make sure that we keep the lights on

and that we have recording booths here for our volunteers. It pays salaries. We have a small but mighty team of three. We maintain over 70 subscriptions with 27 newspapers. So that's another big chunk of our cost. But back in 2016, with our endowment,

we were relying on it so much. We would have spent it all in five years. if we were to continue at the rate we were going. I had never written a grant in my life, and so I very quickly took an online grant writing course and just taught myself how to do it on the fly, essentially. I am so grateful that every day I am of service, and I forget that sometimes when I'm crunching numbers

and trying to check boxes, and then we'll get a phone call from someone that says, thank you for making the Lincoln Journal Star available because I was able to find a volunteer position as a low vision person and they have since asked me to be on their board of directors. And I would have missed that opportunity had you not read that newspaper article.

It's just, it's kind of incredible. It is incredible. Becca Jertie, executive director of radio talking book service in Omaha, Nebraska. You know, we always say it, but it's true. We can't do this series. without you, so let us know what's going on in your economy. You can do that at marketplace.org slash my economy.

Coming up. It's a red, white, and blue umbrella. It's a good day to go to the beach. But first, let's do the numbers. U.S. markets were closed for the Juneteenth holiday. Jordan and Stacey and I talked a bit about the uncertainty, still hanging over the agreement between the U.S. and Iran and global energy markets.

its oil prices moved up and down with the back and forth around negotiations and ceasefires. Benchmark Brent crude futures for August hovered around $80 a barrel. U.S. West Texas intermediate futures for July, danced around $77 a barrel. And where you might be on that supply chain, AAA reports. The national average for gas is $3.97 a week ago, $4.10. A month ago, $4.53. Looking ahead to next week, Circle Thursday on your calendar for a free ticket to Data Paloosa. We've got first quarter GDP revision, May durable goods, and the Fed's preferred inflation measure, personal consumption expenditures.

You're listening to Marketplace. Hey, everyone. I'm Rie Maechres, host of the Marketplace podcast. This is uncomfortable. We all have that one financial task we're putting off. Maybe it's a bill you need a dispute, some paperwork you've got to submit, an account even neglecting. Personally, I've got a pretty long list. You know, studies show that it's much easier to get things done if you do them alongside someone else. So on July 1st, that is what we're going to do. I'm hosting a virtual co-working event where we all show up with at least one financial task we've been avoiding and spend an hour finally dealing with it together.

So please bring the thing you've been putting off. I'll bring mine. And we'll see you on July 1st. You can sign up for the virtual event at marketplace.org slash TIU. This is Marketplace. I'm Amy Scott. In an economy that's racing towards automation, you might think a hotel housekeeper's job would be relatively safe. But while AI can't make the beds or scrub the sinks, automation is already disrupting some jobs. Rebecca Pleven with the nonprofit tech newsroom, Proof News, has the story.

Elsa Roldon is a housekeeper at a luxury hotel on the Las Vegas Strip. She used to have near complete control of the order of the room she could. cleaned. She checked off her progress on a clipboard. That changed in 2019 when her employer rolled out a software called the Hotel Service Optimization System, or Hot Sauce. It uses an algorithm to rank which rooms to clean next. You have a device like telling you, move here, move there, like if you were a robot. The app is from Spanish tech company Amadeus. In 2021, it said hot sauce was used by more than 70% of global hotel brands in 70 countries. It promises to speed room turnover and boost worker productivity.

But Raldon told me the app center zigzagging around the massive hotel with her bulky cart. We literally can waste more than 20 minutes in the travel time. Elevators are busy. The car is slow. It also tracks her progress throughout the day, clocking when she starts and finishes each room. I asked Amadeus about worker dissatisfaction, but no one responded. Roldon is part of a union of 60,000 hotel workers in Nevada.

Soon after hot sauce was introduced, the union started negotiating more autonomy from the app. In 2022, it won. Yes, we go with the instructions, but also if we see that a room is available to clean, we can do it. Unions are in many cases using bargaining to establish basic protections against AI and automation in the workplace. But just 10% of the country's workers are union members, resulting in a patchwork of protection.

I met housekeeper Luce Nunez at a resort near Palm Springs in California. She said the app makes her job more stressful. She's not represented by a union. She has a daily quota, and managers can use hot sauce to monitor her productivity. She says, if you don't change the bed, they give you 20 or 25 minutes. And if you take longer than that, they'll ask you, why did you take so long? Most days, she logs a 10-minute break but keeps working, fearing she won't reach her quota.

Instead, she tries to take it a little easier. She says she doesn't sit down or anything. Rather, she works a little slower. Then she picks up her pace again, ready for the algorithm to serve up another room to clean. In Palm Springs, I'm Rebecca Pleven for Marketplace. On an unseasonably hot day in Venice Beach, California earlier this year, people were out in force with their beach umbrellas, bright ones, striped ones. It's a red, white, and blue umbrella. Popping open for shade.

It was just $5, and I seen it. I was like, let me go ahead and get this with the chair, and then I thought it would be beneficial to have shade. When you're under the umbrella, like, that breeze, like, feels nice and you feel cool. If only cooling the planet were as easy as opening a beach umbrella. Well, what if I told you there are people actually looking into that idea as a real climate solution? So if we're too hot out here and we want a little bit less sunlight, we can put up the shade, block some of the sun and cool us off. Obviously, the technology would be different in space, but the concept is exactly the same. Morgan Goodwin is executive director of the Planetary Sunshade Institute.

The organization brings together climate scientists, aerospace engineers, and governance experts to study how we could cool the Earth by reflecting sunlight from outer space. Imagine something like an umbrella about the size of Argentina. We need to think of spacecraft or shadecraft that are very large and very flat. And so the umbrella is a really good kind of metaphor for that. Instead of one massive spacecraft or shadecraft, you would want to figure out the optimal size and then construct a very large number of those to form the kind of a total area that you would need to block. Flying together like a school of fish sort of?

Exactly, yeah. A constellation would be the celestial term. Right. Other proposals include a shield made up of thin film. bubbles or a cluster of solar sails, just hanging out giving us some shade here on Earth. There's a region of space about four times further away than the moon, where objects that are placed there maintain a constant position. This area in space is known as L1 or Lagrange Point 1. It's where gravitational forces between the Earth and the Sun cancel each other,

so objects kind of stay put. That would allow continuing. with shading of the planet. Think about roughly a 1% dimming of the sunlight, and the climate science that we look to says that would equate to a roughly 1 degree Celsius global average temperature reduction. This idea is in the early stages. It's a tiny field, mostly researchers talking to other researchers, and there would be risks like termination shock,

the sudden warming that would result if the sunshade failed. A planetary sunshade could affect, rainfall in harmful ways. Others say investing in tech solutions like this is a distraction from the real solution, decarbonizing our lives. Goodwin says a sunshade is no substitute for reducing emissions and removing some of the carbon we've already emitted from the atmosphere. Even if we do both of those things as aggressively and as well as we possibly can, it still puts us into a climate trajectory that risks catastrophic tipping points. And that's even in those best case scenarios, which we are not on.

A planetary sunshade would also be expensive in the low trillions of dollars, Goodwin says, though the predicted costs of unmitigated climate change are far greater. And Goodwin says the rapidly growing space economy makes a giant sunshade more feasible. To hear more about that and why many scientists are skeptical of climate interventions like this, check out the latest season of how we survive wherever you listen to podcasts. This final note on the way out, we're in the midst of the first World Cup since prediction markets really took off as a new way to bet on sports, and Bloomberg reports more than

$5 billion have been traded on the game so far on the platform's Polly Market and Kalshi. Meanwhile, Draft Kings said last weekend was its biggest ever, for event contracts, bigger even than the Super Bowl. And while plenty of money is being made, one polymarket user reportedly lost nearly $9 million when Belgium failed to beat Egypt. They tied 1-1. Think I'll stick with the no-stakes FIFA match predictor. Our theme music was composed by B.J. Leatherman.

Marketplace's executive producer is Nancy Fargolly. Joanne Griffith is the chief content officer. Neil Scarborough is the Vice President and General Manager, and I'm Amy Scott. Have a great weekend. We will be back on Monday. This is APM. Ryan, can you believe it? This week is our season finale of Million Bazillion, the podcast about money for kids and families.

And what a way to close it out at the premiere of our first Hollywood film, The Penny Movie. That's right, which coincidentally happened the same week. We got the question, why did we stop making pennies? learned so much about them. Did you know the original face on the penny was a woman? Tis I, Lady Liberty, my visage engraved into the earliest pennies, made of pure copper, and larger than a modern penny. Nothing can stop me from being a symbol of freedom. Don't miss our last episode of the season, guys. Listen to Million Bazillion on your favorite podcast app. You know,

Thank you.