Mortgages Blog

Finance Blogs » Mortgages » Homebuilders feel the love

Homebuilders feel the love

By Judy Martel · Bankrate.com
Wednesday, July 17, 2013
Posted: 6 pm ET

Confidence among homebuilders just keeps soaring, reaching the highest level in seven years this month, according to the National Association of Home Builders monthly index.

The NAHB/Wells Fargo Housing Market Index is at 57, 5 points above where it was in June. A score of 50 marks the division from positive to negative sentiment. Last month was the first time the index was above 50 since April 2006.

It's all looking up

All three components of the index, which gauges perceptions of single-family homebuilders, increased in July. Current sales conditions, at 60, gained 5 points; sales expectations in the next six months increased 7 points to 67; and prospective buyer traffic rose 5 points to 45. Each of the three components had its strongest reading since late 2005.

The index's three-month moving averages were up for all four regions: The Northeast gained 4 points to 40, the Midwest had an 8-point gain to 54, the South posted a 5-point gain to 50, and the West measured a 3-point gain to 51.

Buying new because of a lack of used houses

NAHB chief economist David Crowe said in a release that builders are reporting that lack of existing homes for sale is driving more motivated buyers into new homes. "Meanwhile, as the infrastructure that supplies home building returns, some previously skyrocketing building material costs have begun to soften," he added.

Searching for the cloud's gray lining

Rick Judson, chairman of the NAHB, confirmed in a release that July's report is positive across the board but sounded a cautionary note. "This positive momentum could be disrupted by threats on the policy side, particularly with regard to the mortgage interest deduction and federal support for the housing finance system," he said.

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

«
»
Bankrate wants to hear from you and encourages comments. We ask that you stay on topic, respect other people's opinions, and avoid profanity, offensive statements, and illegal content. Please keep in mind that we reserve the right to (but are not obligated to) edit or delete your comments. Please avoid posting private or confidential information, and also keep in mind that anything you post may be disclosed, published, transmitted or reused.

By submitting a post, you agree to be bound by Bankrate's terms of use. Please refer to Bankrate's privacy policy for more information regarding Bankrate's privacy practices.
4 Comments
Teri
July 19, 2013 at 6:50 pm

Lack of used homes? So, what happened to all the foreclosures?

David
July 19, 2013 at 11:36 am

You have got to be kidding me. This housing market is on the verge of collapse again. The Spanish, (legal or illegal) are the only ones working in the U.S. look @ the U-6 #'s for the real # on unemployment !! The houses here are made of the cheapest china wood known to man. Plywood Press wood stuck together by glue warps and does not hold up @ all. Foundations crack out even before the house structure is heavy weigh on top of it and the nails fall through the sheetrock. They are building 5 year houses, & after that, sell them off @ horrific losses. The houses being built here are just that, (Terrible)!! We as the American citizen, have sold out to the almighty $. It sickens me. Putting out this advertisement is a dishonest deed once again. I can only hope you print a retraction on this and tell the truth. If you do, your paper will soar and maybe we will gain our country back as it should be? Every day something new for the worst is coming out of D.C. When will it end, I have not had a job full time in over 6 years now. I live in a tent with my laptop. I go to school & do a lot of dumpster diving. I wash my clothes in a nearby creek. So do not tell me the housing market is good to go. I got to go now, Potty Time..

Add a comment

(Comments may take 5-10 minutes to appear)