Confidence Among Homebuilders in U.S. Falls From 11-Month High

Confidence among U.S. homebuilders cooled in October from an 11-month high, reflecting a pause in the market for single-family houses, according to data from the National Association of Home Builders/Wells Fargo.

Key Points

  • Builder sentiment gauge dropped to 63 (matching forecast) from the prior month’s 65 that was the highest since October 2015; readings greater than 50 mean more respondents reported good market conditions
  • Index of prospective buyer traffic fell to 46 from 47
  • Measure of six-month sales outlook rose to 72, the highest in a year, from 71
  • Gauge of current sales decreased to 69 from an almost 11-year high of 71

Big Picture

Developers’ sentiment may have been restrained by factors including the limited availability of ready-for-building lots and skilled workers. At the same time, mortgage rates still close to historically low levels and a healthy job market will help keep the housing rebound on track.

Economist Takeaways

The report “represents a mild pullback from a jump in September,” NAHB Chief Economist Robert Dietz said in a statement. “The housing market continues to make slow and steady gains.”

The Details

  • Builder confidence climbed in two of four regions
  • It decreased eight points in the West to 74, slipped four points in the South to 64
  • Sentiment rose four points in the Northeast to 46, two points in the Midwest to 59
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