For the fourth consecutive month, builder confidence in the market for new, single-family homes remained unchanged at 16 in February, according to this month’s National Association of Home Builders/Wells Fargo Housing Market Index.
The index is based on a monthly survey that NAHB has been conducting for more than 20 years. It serves to gauge builder sentiment on single-family home sales, and get a sense of sales expectations for the coming six months. Tight credit continues to stifle new construction, among other challenges.
“While builders are starting to see more interest among potential home buyers, we are also dealing with a multitude of challenges, including competition from foreclosure properties and inaccurate appraisals of new homes, which are limiting our ability to sell,” said NAHB Chairman Bob Nielsen, who is a home builder from Reno, Nev. “On top of that, an extremely tight lending environment continues to make it almost impossible to obtain credit for viable new and existing projects, and most do not see that situation improving anytime soon.”
Scores from survey components are used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view sales conditions as good than poor.
Regionally, HMI scores were mixed in February. The Northeast region saw a two-point gain to 22, the Southern region posted a one-point gain to 18, the Midwest saw a one-point decline to 12 and the West posted a two-point decline to 13.
For the full index report, visit NAHB.org.
Written by Elizabeth Ecker