Confidence Levels Continue to Soar

Home builder and consumer confidence levels continue to be an important factor regarding economic recovery.

Home Builder Confidence Soars in June 2013

by Myles Biggs

At the end of May, several reports indicated that consumer confidence levels in the economy, housing and labor markets were on the rise. This month, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), builder confidence increased a total of eight points – from 44 to 52 – in the single-family homes market. This is the largest one-month gain in the HMI since 2002, when it also jumped 8 points. HMI readings over 50 are an indication that more builders view both sales and housing market conditions as positive, rather than negative. 

In a press release issued yesterday by the NAHB, Chairman Rick Judson stated: “This is the first time the HMI has been above 50 since April 2006, and surpassing this important benchmark reflects the fact that builders are seeing better market conditions as demand for new homes increases.” Judson went on to state that low inventory numbers of existing homes are continuing to push home buyers toward new home construction.

Housing growth continues to be a strong economic indicator and this link between consumer confidence and the confidence of home builders will be a key component in U.S. economic recovery projections.

As a consumer or potential home buyer, does this announcement of increased home builder confidence improve your outlook on the housing market or the overall economy? Give us your opinion in the comments section below.