Builder Confidence Sees Best Stretch In Years
The National Association of Home Builders conducts a monthly survey to measure how confident builders are in the market for newly built, single-family homes. After all, if builders – whose livelihood depends on selling new homes – are optimistic about the market, chances are good that conditions are favorable for buyers too. According to the most recent results, builder sentiment over the past three months has been higher than at any time since December 2017. In fact, February's results scored a 74 on a scale where any number above 50 indicates more builders feel conditions are good than poor. Dean Mon, NAHB's chairman, says there are a number of positive factors that are keeping builders optimistic, but there are some lingering challenges as well. “Steady job growth, rising wages, and low-interest rates are fueling demand but builders are still grappling with increasing construction and development costs,” Mon said. Those increasing costs make it challenging for builders to build affordable new homes, which are important right now since there are fewer entry-level homes available for sale in many markets. Still, a high level of optimism from home builders is a good sign for the 2020 housing market.