Home builders are typically optimistic about the market for new homes as spring approaches – but not so much this year.
According to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), builder confidence in the market for newly built, single-family homes rose only one percentage point in March, compared to February – rising to 47 from 46 on the index.
Kevin Kelly, chairman of the NAHB and a home builder from Wilmington, Del., says home builders ‘continued to be affected by poor weather and difficulties in finding lots and labor’ during February and the first half of March.
David Crowe, chief economist for the NAHB, says ‘a shortage of buildable lots and skilled workers, rising materials prices and an extremely low inventory of new homes for sale’ are factors that have sapped builder confidence during the past month.
The index's components were mixed in March. The component gauging current sales conditions rose one point to reach an index score of 52, and the component measuring buyer traffic increased two points to 33. The component gauging sales expectations in the next six months fell one point to 53.
The three-month moving averages for regional HMI scores all fell in March. The Northeast dropped three points to 35, the Midwest fell three points to 53, the South posted a four-point decline to 49 and the West registered a two-point drop to 61.
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