Builder confidence in the market for newly built, single-family homes increased six points to a level of 71 on the National Association of Home Builders Housing Market Index, the highest reading since June 2005.
The HMI consists of three components. The component gauging current sales conditions rose seven points to 78, sales expectations in the next six months went up five points to 78 and buyer traffic rose eight points to 54.
The HMI three-month moving average rose three points in the Midwest to 68 and one point in the South to 68. It decreased three points to 76 in the West and one point to 48 in the Northeast.
"While builders are clearly confident, we expect some moderation in the index moving forward," said NAHB Chief Economist Robert Dietz in a statement. "Builders continue to face a number of challenges, including rising material prices, higher mortgage rates, and shortages of lots and labor."
