Builder Confidence Keeps Rising
Homebuilder perceptions of the market continue to rise, showing the biggest monthly increase in July since September 2002. The figure represents the best overall feeling about the housing market from builders since March 2007.
Homebuilder confidence continues to rise, reaching the highest level in five years, indicating continued growth in the housing market even as the larger economy has slowed.
The monthly National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) rose six points in July to 35, the highest level since March 2007 and the largest monthly bounce since September 2002. The reading is the closest market perceptions have been to an above-water score of 50 or higher since before the recession
The three component scores of the HMI include questions on current sales conditions, buyer traffic and sales expectations for the next six months. Readings of sales conditions and buyer traffic both increased by six points in July, to 37 and 29 respectively. The biggest jump was in sales expectations, which rocketed up 11 points to a score of 44, fueled by nationwide improvements in builder sentiment.
''Builder confidence increased by solid margins in every region of the country in July as views of current sales conditions, prospects for future sales and traffic of prospective buyers all improved,'' said Barry Rutenberg, chairman of the NAHB. ''This is greater evidence that the housing market has turned the corner, as more buyers perceive the benefits of purchasing a newly built home while interest rates and prices are so favorable.''