Builders Remain Confident In Market For New Homes

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Builder confidence slipped two points in March, according to the National Association of Home Builders Housing Market Index. The index measures builders’ perception of the market for new homes on a scale where any number above 50 indicates more builders view conditions as good than poor. Despite the drop, however, the index remains in positive territory at 53. David Crowe, the NAHB’s chief economist, said the decline in confidence is largely due to supply chain issues, including lot and labor shortages. But Crowe expects the market to overcome these issues based on renewed strength in the economy. “We are expecting solid gains in the housing market this year, buoyed by sustained job growth, low mortgage interest rates, and pent-up demand,” Crowe said. And a closer look at the numbers reveals most builders agree with Crowe. In fact, among the three components of the index measuring current buyer traffic, current sales, and sales expectations for the next six months, only the gauges of current conditions fell, while expectations for future sales remained unchanged from the month before at 59. This indicates that, though builders may have had a slow winter, most are expecting the market to improve during the spring and summer seasons. More here.

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