NAHB Home Builder Confidence Stays Weak; Gasoline Prices Citied

Headline Alert

Economic Update: NAHB Home Builder Confidence Index

The National Association of Home Builders Housing Market Index for May was reported at 16. This was in line with the estimates for a reading of 16.

Prior readings for comparison purposes:

• April: 16
  
• March: 17
  
• February: 16
  
• January: 16
  
• December: 16
  
• November: 16
  
• October: 16
  
• September: 13
  
• August: 13
  
• July:14
  
• June: 16

“Builder confidence has hardly budged over the past six months as persistent concerns regarding competition from distressed property sales, lack of production credit, inaccurate appraisals, and proposals to reduce government support of housing have continued to cloud the outlook,” said NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. “In addition, many builders in this month’s survey cited high gas prices as a further contributor to consumer anxiety and reluctance to go forward with a home purchase.”

“The HMI component index measuring traffic of prospective buyers increased by one point for the second time this year as prospective buyers show growing interest but remain extremely hesitant due to a number of factors,” said NAHB Chief Economist David Crowe. “Asked to identify reasons that potential customers are holding back at this time, 90 percent of builders surveyed said clients are concerned about being able to sell their existing home at a favorable price, while 73 percent said consumers think it will be difficult for them to get financing. Clearly, access to credit for both builders and buyers remains a considerable obstacle to the revival of the new-homes market.”

The NAHB/Wells Fargo Housing Market Index is a monthly survey of that measures builder perceptions of current single-family home sales and sales expectations for the next six months. Reading above 50 are considered positive.

 

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