Builder Confidence Ends Year to Highest Reading Since 1999
Builder confidence in the market for newly built single-family homes increased five points to 76 in December off an upwardly revised November reading to its highest reading since June 1999, the National Association of Home Builders reported yesterday.
The NAHB/Wells Fargo Housing Market Index reported all three HMI components registered gains in December. The HMI index gauging current sales conditions rose seven points to 84; the component measuring sales expectations in the next six months edged up one point to 79; and the measure charting traffic of prospective buyers increased four points to 58.
Looking at the three-month moving averages for regional HMI scores, the Northeast fell two points to 61, the Midwest increased by five points to 63, the South moved one point higher to 76 and the West rose three points to 84.
“Builders are continuing to see the housing rebound that began in the spring, supported by a low supply of existing homes, low mortgage rates and a strong labor market,” said NAHB Chief Economist Robert Dietz. “While we are seeing near-term positive market conditions with a 50-year low for the unemployment rate and increased wage growth, we are still underbuilding due to supply-side constraints like labor and land availability. Higher development costs are hurting affordability and dampening more robust construction growth.”