After sitting tight for four straight months, confidence among
U.S. home builders improved in June. A monthly survey of builder sentiment from
the National Association of Home Builders (NAHB) rose two points to 60.
Anything above 50 is considered "positive" sentiment.
"Builders in many markets across the nation are reporting
higher traffic and more committed buyers at their job sites," said NAHB
Chairman Ed Brady, a home builder and developer from Bloomington, Illinois.
"However, our members are also relating ongoing concerns regarding the
shortage of buildable lots and labor and noting pockets of softness in
scattered markets."
June's reading is the highest since January of this year but the
same as June of 2015. Of the index's three components, all posted gains.
Current sales conditions rose one point to 64, sales expectations in the next
six months increased five points to 70. Buyer traffic rose three points to 47,
but it is still the only component in negative territory.
"Rising home sales, an improving economy and the fact that
the HMI gauge measuring future sales expectations is running at an eight-month
high are all positive factors indicating that the housing market should
continue to move forward in the second half of 2016," said NAHB chief economist
Robert Dietz.
Home builders have benefited from very short supply of existing homes for sale nationwide, but their costs continue to rise, and they are passing those on to buyers in the form of higher prices. Sales of newly built homes jumped dramatically in April, as did prices. The median price of a newly built home hit $321,100, up 9.7 percent year-over-year to the highest level on record.
