Builder Confidence Remains Steady

Builders didn’t gain or lose confidence in new home construction this month.
The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) was released today to show that builder confidence in the market for newly built, single-family homes in December is at 16, the same as November, which had posted a one-point increase from October.
Building permit, a hammer and a ruler“Builders are bracing themselves for a slow holiday season as a number of factors continue to cause uncertainty among consumers and builders alike,” said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. “While the HMI is adjusted for seasonal factors, the typical cold-weather slowdown in sales activity is being accentuated by ongoing weakness in the job market, the rising number of foreclosures and short-sales, and very challenging credit conditions for both builders and buyers.”
Two of the three components of December’s HMI also remained unchanged:
*The component gauging current sales conditions stayed at 16
*The component gauging sales expectations over the next six months stayed at 25
*The component gauging traffic of prospective buyers fell one point to 11
“The steady but low level of the HMI reflects the fact that builders and consumers have yet to see consistent signs that the economy is improving,” said NAHB Chief Economist David Crowe. “The good news is that the index and its sub-components remain above recent lows from the early fall. NAHB expects an improving job market this spring will help prospective buyers feel more confident and propel more sales activity in 2011.”
Here’s wishing for steady increases in builder confidence throughout the new year.