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Homebuilder confidence in the market for new single-family homes rose in April as so-called buyer traffic increased to new developments.
The seasonally adjusted National Association of Home Builders/Wells Fargo Housing Market Index rose to 63 points in April from 62 in March. The gauge remained below the 68 points recorded for April 2018.
“Builders report solid demand for new single-family homes, but they are also grappling with affordability concerns stemming from a chronic shortage of construction workers and buildable lots,” said NAHB Chairman Greg Ugalde, a developer from Torrington, Connecticut.
The index measuring current sales conditions increased to 69 points from 68, while buyer traffic rose to 47 from 44. Expectations for the next six months fell to 71 from 72.
The regional HMI scores show the Northeast rose to 56 points from 52, the South fell to 66 from 70, the West rose to 72 points from 69 and the Midwest rose to 56 from 49 points.
“Ongoing job growth, favorable demographics and a low-interest rate environment will help to modestly spark sales growth in the near term,” said NAHB Chief Economist Robert Dietz. “However, supply-side headwinds that are putting upward pressure on housing costs will limit more robust growth in the housing market.”
NOTE: The NAHB/Wells Fargo Housing Market Index gauges builder opinions of single-family home sales and expectations, asking for a rating of good, fair or poor. Builders are also rate prospective buyer traffic from very low to very high. The scores are used to calculate a seasonally adjusted index with a rating above 50 indicating positive sentiment.