Builder confidence in the market for new single-family homes rose for the first time in five months, as the National Association of Home Builders’ housing market index jumped to 16 in October from an unrevised 13 in September.
Thomson Reuters’ poll of economists predicted a level of 14 for the gauge of home-builder sentiment.
The index, which has averaged 50 since it began in 1985, has stabilized at a fraction of its historical norm. It has averaged 16 so far this year and has not surpassed 50 since April of 2006.
“Builders are starting to see some flickers of interest among potential buyers, and are hopeful that this interest will translate to more sales in the coming months,” said NAHB chairman Bob Jones. “However, because most builders still have no access to credit for building homes, there is a real concern that we will not be able to meet the pent-up demand when consumers are ready to get back in the market. This problem threatens to severely slow the housing and economic recovery.”
The gauge’s three component indexes all gained in October.