Home Builder Confidence Holds Steady
As consumers wait to see whether interest rates will rise and continue to go against a tight lending environment, builder confidence nationwide was unchanged in September, following four months of improvement.
According to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), builder confidence for newly built, single-family homes held at 58, the same as August, also its highest level in nearly eight years.
“Following a solid run up in builder confidence over the past year, we are seeing a pause in the momentum as consumers wait to see where interest rates settle and as the headwinds of tight credit, shrinking supplies of lots for development and increasing labor costs continue,” NAHB Chief Economist David Crowe said.
The index gauges builder perceptions of current single-family home sales and expectations for the next six months, and a reading of more than 50 indicates that more builders view conditions as good than poor.
Component indexes were mixed in September, with the current sales index holding at 62 and six-month expectations dropping three points, to 65. The index gauging traffic of prospective buyers was up one point, to 47.
All four regions of the country showed gains in their three-month average readings, with the Northeast posting a two-point increase, to 41. The South also had a two-point gain, to 56. Meanwhile, the Midwest and West were up four points, to 64 and 61 respectively.
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