Builders' confidence in the market for new single-family homes was steady as the National Association of Home Builders' housing market index — a monthly gauge of builder sentiment — remained at 60 in July.
Thomson Reuters' poll of economists predicted the index would be 59.
The June reading was revised to 60 from the initially reported 59. The index hadn't been at 60 since November 2005.
"The fact that builder confidence has returned to levels not seen since 2005 shows that housing continues to improve at a steady pace," NAHB Chairman Tom Woods said. "As we head into the second half of 2015, we should expect a continued recovery of the housing market."
"This month's reading is in line with recent data showing stronger sales in both the new and existing home markets as well as continued job growth," according to NAHB Chief Economist David Crowe. "However, builders still face a number of challenges, including shortages of lots and labor."
Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months as either "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as either "high to very high," "average" or "low to very low." Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
The current single-family home sales index increased to 66 from 65, the sales expectations index for the next six months rose to 71 from 69; and the traffic of prospective buyers index slipped to 43 from 44.
