Confidence In New Home Market Grows
Supply and demand have a lot to do with how much it costs to buy a house. When there are more homes than buyers, prices fall and buying becomes more affordable. When there are more buyers than homes, it gets more expensive. That's why the new home market is so important. After all, new home construction is a big part of the supply side of that basic equation. That's why a new survey from the National Association of Home Builders is encouraging. Their Housing Market Index asks builders for their opinion of the new home market and scores their responses on a scale where any number above 50 indicates more builders view conditions as good than poor. In October, the index hit 71, its highest score since February 2018. In short, home builders are feeling good about the market for newly built homes and it could help affordability levels. Greg Ugalde, NAHB's chairman, says there are a few factors that are boosting confidence in the market. “The housing rebound that began in the spring continues, supported by low mortgage rates, solid job growth, and a reduction in new home inventory,” Ugalde said. If builders' confidence in the market leads to more new home construction, it could have a balancing effect on the market which will help moderate future price increases and overall affordability. More here.