A central gauge of confidence in the new single-family home market turned positive in June for the first time in more than six years, adding eight points to the NAHB's Housing Market Index for a reading of 52, on a scale where readings over 50 indicate that more builders view conditions as good than poor.

Builder confidence in the market for new single-family residences reached a significant milestone in June, as the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) surged eight points to a reading of 52, according to an NAHB report released June 17.

"This is the first time the HMI has been above 50 since April 2006," said NAHB Chairman Rick Judson. "Surpassing this important benchmark reflects the fact that builders are seeing better market conditions as demand for new homes increases."

The eight-point jump in the index was the biggest one-month gain since August and September of 2002, when the HMI recorded a similar increase of eight points.

"Builders are experiencing some relief in the headwinds that are holding back a more robust recovery," said NAHB chief economist David Crowe. "[The] report is consistent with our forecast for a 29 percent increase in total housing starts this year, which would mark the first time since 2007 that starts have topped the 1 million mark."

Responses to all three HMI components posted gains in June. The index gauging current sales conditions increased eight points to 56, while the index measuring expectations for future sales rose nine points to 61 – its highest level since March 2006. The index gauging traffic of prospective buyers rose seven points to 40.

HMI tables can be found at nahb.org/hmi.