Builders’ confidence in the market for new single-family homes crept up in January, as the National Association of Home Builders’ housing market index — a monthly gauge of builder sentiment — climbed to its highest level since September 2008, rising to 16 in May from 14 in April, the group announced yesterday.
Thomson Reuters’ poll of economists predicted a level of 17.
“Builders are responding to what they perceive to be some of the best home buying conditions of a lifetime,” said NAHB chairman Joe Robson. “You’re not likely to get a better deal in terms of mortgage rates than what’s available right now. Combine that with the affordable prices, multitude of home choices, and $8,000 tax credit for first-time buyers that are now available, and you have a very appealing set of reasons to make a move.”
NAHB chief economist David Crowe said: “The fact that the May HMI continued to tick up from April’s five-point increase provides confirming evidence that the improved confidence level was no fluke.”
“This continued increase indicates that home builders feel we’re at or near the bottom of the market and that positive signs lie ahead for builders and potential home buyers, provided that builder access to production credit significantly improves,” he said.
Two of the three component indexes increased in May, while the other was flat. The current single-family home sales index rose to 14 from 12, the sales expectations index for the next six months increased to 27 from 24, and the traffic of prospective buyers index held at 13.
