Builders’ confidence in the market for new single-family homes improved as the National Association of Home Builders’ housing market index, a monthly gauge of builder sentiment, increased to 18 in October from 14 in September.
Thomson Reuters’ poll of economists predicted the index would rise to 15.
“This latest boost in builder confidence is a good sign that some pockets of recovery are starting to emerge across the country as extremely favorable interest rates and prices catch consumers’ attention,” said NAHB economist David Crowe
“However, it’s worth noting that while some builders have shifted their assessment of market conditions from 'poor’ to 'fair,’ relatively few have shifted their assessments from 'fair’ to 'good.’ One reason is that builders are facing downward pricing pressures from foreclosed homes at the same time that building materials costs are rising, and this is further squeezing already tight margins.”
