November Builder Confidence Holds Firm

 

The National Association of Home Builders said builder confidence in the market for newly-built single-family homes held steady in November.

The NAHB/Wells Fargo Housing Market Index remain unchanged at 63 in November. Components measuring buyer traffic rose one point to 47; the index gauging current sales conditions held steady at 69. Meanwhile, the component charting sales expectations in the next six months fell two points to 69.

Regionally, the Northeast, Midwest and West each posted two-point gains to 45, 58 and 77, respectively. The South remained unchanged at 66.

“The builder sentiment index is two points above its six-month average and remains at a level consistent with modest gains in home sales,” said Mark Vitner, senior economist with Wells Fargo Securities, Charlotte, N.C. “Buyers appear to be balking at higher priced homes, causing builders to adjust their product mix.”

“Ongoing job creation, rising incomes and attractive mortgage rates are supporting demand in the single-family housing sector,” said NAHB Chief Economist Robert Dietz.. “This will help keep housing on a steady, upward glide path in the months ahead.”

The index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.