U.S. Home Builder Confidence Rises to Highest Level in Nine Months

Confidence among U.S. home builders in June jumped to the highest level in nine months, suggesting the housing market may be gaining momentum after a winter lull. The National Association of Home Builders’ confidence index rose five points to 59, beating economists’ predictions for a reading of 56. NAHB chief economist David Crowe remarked that measures of current and future sales expectations “are at their highest levels since the last quarter of 2005, indicating a growing optimism among builders that housing will continue to strengthen in the months ahead. At the same time, builders remain sensitive to consumers’ ability to buy a new home.” Throughout the recovery, new-home construction has stayed “choppy” even when builder confidence has trended high. Joshua Shapiro, chief U.S. economist for MFR Inc., said the June index is significantly higher than what economists would usually anticipate considering the lukewarm pace of housing starts. He noted, “There remains a big disconnect between what home builders are saying and what they are actually doing.” If builders do boost construction activity to meet perceived demand, that would help create new jobs, increase materials purchases, and bolster an economy that slowed early in 2015. | Read More