Builder Confidence Declines Three Points in JuneJune 15th, 2011 by DWM Magazine
After holding at a low but steady level for the past six months, builder confidence in the market for newly built, single-family homes declined three points in June to a reading of 13 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), released today. The last time the index was this low was in September of 2010.
“Builder confidence has waned even further as economic growth has stalled, foreclosures have continued to hit the market and the cost of building a home has risen,” says NAHB chief economist David Crowe. “Meanwhile, potential new-home buyers are being constrained by difficulty selling their existing homes, stringent lending requirements, and general uncertainty about the economy. Economic growth must pick up in order for housing to gain the momentum it needs to get back on track.”
Every component of the HMI fell in June. The component gauging current sales conditions and the component gauging traffic of prospective buyers each fell two points, to 13 and 12, respectively. The component gauging sales expectations in the next six months fell four points to tie its record low score of 15 set in February and March of 2009.
The Northeast was the only region to post a gain in its HMI score for June, rising two points to 17. Meanwhile, the Midwest dropped three points to 11, South dropped two points to 14 and the West posted a four-point decline to 12.