U.S. home builder confidence rises in May

Confidence among U.S. home builders rose in May — a time of rising home prices despite increased costs of building materials — following several months of declines, CNBC reported.

The National Association of Home Builders/Wells Fargo Housing Market Index posted a three-point gain to 44 from the 41 recorded in April. A number over 50 on the index shows that a majority of the 341 builders surveyed see market conditions as good, rather than poor.

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“Builders are noting an increased sense of urgency among potential buyers as a result of thinning inventories of homes for sale, continuing affordable mortgage rates and strengthening local economies,” said NAHB Chairman Rick Judson. “This is definitely an encouraging sign even amidst rising challenges with regard to the cost and availability of building materials, lots and labor.”

Each component of the index posted gains in May. For example, current sales conditions gained four points to 48, and expectations for future sales inched up one point to 53, which is its highest number since February 2007. [CNBC]Zachary Kussin