Confidence among U.S. homebuilders increased in August to its highest point in seven months. The National Association of Home Builders/Wells Fargo (HMI) sentiment measure rose to 55, up from 53 a month earlier, easily beating forecasts.
“As the employment picture brightens, builders are seeing a noticeable increase in the number of serious buyers entering the market,” NAHB Chairman Kevin Kelly said, in a statement. “However, builders still face a number of challenges, including tight credit conditions for borrowers and shortages of finished lots and labor.”
All three index components made gains in August, data showed. The index gauging traffic of prospective buyers increased three points to 42, while the indices for current sales conditions and expectations for future sales each rose two points to 58 and 65, respectively. Every U.S. region improved its three-month moving average HMI score in August, with the Midwest measure alone jumping seven points.
“Each of the three components of the HMI registered consecutive gains for the past three months, which is a positive sign that builder confidence appears to be firming following an uneven spring,” said NAHB Chief Economist David Crowe. “Factors contributing to this rise include sustained job growth, historically low mortgage rates and affordable home prices, which are helping to unleash pent-up demand.”