Home Builder Confidence Falls
Monthly Confidence Index Ticked Up Just One Point In June
A slowdown in job growth appears to have dealt a blow to the confidence of American home builders. A monthly confidence index from the National Association of Home Builders ticked up one point in June, after having risen four points in May. Now at 29, the index remains far below the reading of 50 that would indicate positive sentiment. Still, it beats the lowest ever reading – 13—which occurred a year ago.
"While the June HMI is in keeping with our forecast for gradually improving single-family home sales this year, recent economic reports have shown some weakening in the pace of recovery likely factored into the marginal gain," David Crowe, NAHB chief economist, said in a written statement. "In addition, builders across the country continue to report that overly tight lending conditions and inaccurate appraisals are major obstacles to completing sales."
While sales expectations over the next six months and buyer traffic remain unchanged, a part of the index measuring current sales conditions rose two points, according to the report. Despite June's confidence reading, the market for new construction has improved considerably this year. In April, for example, housing starts were up nearly 30% over last year, though they remained below normal levels of years past.