Builder confidence in the market for newly built, single-family homes ticked down slightly this month, with a two-point reduction to 44 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).
‘Following eight consecutive months of improvement, builder confidence leveled off in January and has since edged down several points,’ says NAHB Chairman Rick Judson, a home builder from Charlotte, N.C. ‘Although many of our members are reporting increased demand for new homes in their markets, their enthusiasm is being tempered by frustrating bottlenecks in the supply chain for developed lots, along with rising costs for building materials and labor. At the same time, problems with appraisals and credit availability remain considerable obstacles to completing deals.’
While the HMI component gauging current sales conditions declined four points to 47, the component gauging sales expectations in the next six months and the component gauging traffic of prospective buyers both posted gains, of one point to 51 and three points to 35, respectively, in March. Three-month moving averages for each region's HMI score were also mixed, with the Northeast holding unchanged at 39, the Midwest and South posting one-point declines to 47 and 46, respectively, and the West registering a four-point increase to 58.