Builder confidence in the market for newly built, single-family homes increased for the fourth month in a row in September to a level of 59 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI)—the highest level since November 2005.
Builder confidence in the market for newly built, single-family homes increased for the fourth month in a row in September to a level of 59 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI)—the highest level since November 2005.
All three components used to calculate the HMI—current sales conditions, prospective buyer traffic and future sales expectations—posted gains. Builder confidence also increased across every region of the country.
"Since early summer, builders in many markets across the nation have been reporting that buyer interest and traffic have picked up, which is a positive sign that the housing market is moving in the right direction," said NAHB Chairman Kevin Kelly in a statement.
The induce recording current sales conditions rose five points to 63. Prospective buyer traffic also rose five points to 47. Expectations for future sales went up two points to 67.
The Midwest registered a five-point gain, putting builder confidence in the region at 59. The South went up four points to 56, the Northeast up three to 41 and the West up two to 58.
While builder confidence in newly built, single-family homes moved in a positive direction, NAHB Chief Economist David Crowe said he is "not seeing much activity from first-time home buyers."
He said persistently tight credit conditions for consumers and rising costs for materials, lots and labor are still slowing the housing recovery.