Builder confidence rises in October

October 16th, 2012

Despite economic obstacles, builders say they are confident in housing market recovery.

More builders expressed optimism in the housing market for newly-built single-family homes in October, marking the sixth consecutive increase in positive sentiment.

According to the National Association of Home Builders/Wells Fargo Housing Market Index, the index made a one-point gain from September, rising to 41 and the highest level since June 2006.

“Many builders are reporting increases in the number of serious buyers visiting their sales offices, and the overall confidence measure is much higher than it was at this time last year,” noted NAHB Chairman Barry Rutenberg.

While the increase in sentiment is positive, analysts agree that tight credit conditions, low appraisals and a volatile economy are still hindrances to overall housing market recovery. Further, consistently low rates may be prompting more would-be homebuyers to seek out the services of a mortgage consultant to purchase a home, although some find that they may not qualify for the most competitive rates.

These challenges may continue to depress new home building projects and sales in the future, despite a spike in the number of Americans seeking homeownership.