Landscape Architect Articles

Builder Confidence Surges to Seven-Year High07-30-13 | News

Builder Confidence Surges to Seven-Year High

Homebuilders are increasingly optimistic about the state of the single-family housing market, according to the July results of the NAHB's monthly confidence survey. The builder confidence index added six points between June and July to reach a score of 57, a 14 point increase since May and the second straight month of positive market perceptions.

Confidence among builders in the new single-family home market rose six points in July, reaching 57 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) according to a July 16 report. This is the index's third consecutive monthly gain, and its strongest reading since January 2006.

All three HMI components posted gains in July, and two components remained above 50 for a second consecutive month, which is considered the benchmark for a positive reading. The component gauging sales expectations for the next six months gained seven points to 67, and the prospective buyers' traffic indicator rose five points to 45, marking the strongest readings for each section since late 2005. The current sales conditions component rose five points to 60, its highest level since early 2006.

"Builders are seeing more motivated buyers coming through their doors as the inventory of existing homes for sale continues to tighten," said NAHB chief economist David Crowe. "Meanwhile, as the infrastructure that supplies home building returns, some previously skyrocketing building material costs have begun to soften."

Current and previous HMI results can be found at nahb.org/hmi.