Home builder confidence has improved significantly across the board this month, according to the National Association of Home Builders/Wells Fargo Housing Market Index released today, reaching its greatest height since April 2010.
The index, which surveys home builders’ confidence on a monthly basis and measures it on a 1 to 100 scale where any number over 50 indicates more builders view conditions as good than as poor, gained 4 points and hit 18. It had been hovering between 13 and 17 since last spring. The index measuring sales conditions also increased 4 points to reach 18, sales expectations rose 7 points to 24 and the index measuring prospective buyer traffic jumped 3 points to 14.
“Builder confidence regained some ground in October due to modest improvements in buyer interest in select markets where economic recovery is starting to take hold and where foreclosure activity has remained comparatively subdued,” said NAHB Chairman Bob Nielsen. “That said, confidence remains quite low as builders continue to confront overly restrictive lending policies that are discouraging prospective buyers, problems with new-home appraisals and widespread uncertainty regarding federal support for homeownership.”
Regionally, builder confidence was best in the West, where the index gained 9 points, reachING 21. The South’s index went up 4 points to reach 19, while the Midwest’s jumped 4 points to 15, the same point at which the Northeast’s index has remained constant for the last two months. — Adam Fusfeld