After rising slightly in July, builder confidence in the market for newly build single-family homes in August remained unchanged at 15, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Whereas any reading over 50 means builders view the market as "good," the HMI has been running below that point since April 2006. What's more, this is the 10th month of the past 11 in which the index has held within the same three-point range.
After rising slightly in July, builder confidence in the market for newly build single-family homes in August remained unchanged at 15, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Whereas any reading over 50 means builders view the market as "good," the HMI has been running below that point since April 2006. What's more, this is the 10th month of the past 11 in which the index has held within the same three-point range.
"Builders continue to confront the same major challenges they have seen over the past year, including competition from the large inventory of distressed homes on the market, inaccurate appraisal values, and issues with their buyers not being able to sell an existing home or qualify for favorable mortgage rates because of overly tight underwriting requirements," said Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev.
"The uncertain economic climate and concerns about job security are discouraging many potential buyers from exploring a home purchase at this time," said NAHB Chief Economist David Crowe. "While buying conditions are very favorable in terms of prices, interest rates and selection, consumers are worried about what the future will bring, and builders are echoing those sentiments in their responses to the HMI survey."
