Builder confidence in the market for newly built single-family homes edged one point lower in January, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index. The last two monthly readings mark the highest sentiment levels since July of 1999.
"Low interest rates and a healthy labor market combined with a need for additional inventory is setting the stage for further home building gains in 2020," says Greg Ugalde, NAHB chairman.
"With the Federal Reserve on pause and attractive mortgage rates, the steady rise in single-family construction that began last spring will continue into 2020," says Robert Dietz, NAHB chief economist. "However, builders continue to grapple with a shortage of lots and labor while buyers are frustrated by a lack of inventory, particularly among starter homes."
The HMI index charting traffic of prospective buyers increased one point to the highest level since December 2017. The gauge measuring current sales conditions fell three points and the component measuring sales expectations in the next six months held steady.