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Builders get cold shoulder

By Judy Martel · Bankrate.com
Wednesday, February 19, 2014
Posted: 11 am ET

Builder confidence in new-home construction took a sharp dive.

Builder confidence in new-home construction took a sharp dive.

The concern over cost and availability of construction labor, along with an unusually harsh winter, turned builders cold this month. The National Association of Home Builders index measuring builder confidence in new, single-family home construction took a 10-point dive to end up at 46.

"Significant weather conditions across most of the country led to a decline in buyer traffic last month," Kevin Kelly, the National Association of Home Builders chairman, said in a statement. "Builders also have additional concerns about meeting ongoing and future demand due to a shortage of lots and labor."

All three components of the index, which measures current buyer traffic, sales expectations over the next six months and current sales conditions, declined in February. All four regions of the country either declined or remained static in the three-month moving averages.

In February, the component measuring current sales conditions fell farthest, dropping 11 points to 51. The index considers 50 as the dividing line between poor and good conditions. Sales expectations declined by six points to 54, and buyer traffic fell nine points to 31.

Regionally, the West was the only part of the country to remain static, at 63, in the index's three-month moving averages, while the Northeast is still well below 50, dropping four points to 38. The Midwest fell one point to 57; the South declined three points to 53.

Keep up with your wealth and mortgages and follow me on Twitter: @JudyMartel.

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