Builder Confidence Rebounds Strongly in October
Robust home buyer demand brought on by improving economic conditions, low mortgage rates and strong house-price performance boosted builder confidence in the market for new single-family homes to its highest level of the year this month, according to the NAHB/Wells Fargo Housing Market Index (HMI).
The HMI for October rose five points to 72, more than offsetting a four-point decline in September and equaling its reading of a year earlier.
“Rates on long-term mortgages have averaged well below 6% for many weeks now, and adjustable-rate loans have been around 4%, providing a powerful incentive to buy a home,” said NAHB President Bobby Rayburn.
“Another factor that’s undeniably contributing to builder optimism is the large turnout of prospective buyers at model homes and sales offices,” noted NAHB Chief Economist David Seiders. “The HMI component gauging traffic of prospective buyers has remained above 50 since May, which is a strong run for that index and a positive sign for potential sales activity.”