Builders grow more confident
The NAHB-Wells Fargo Housing Market Index rose to 16 from the 15 registered last month.
"Though the gains have been incremental, the fact that builder confidence has improved over the past two months is encouraging," said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. "Many builders are reporting that while the quantity of buyer traffic through their model homes has not improved dramatically, the quality of that traffic seems to be getting better -- meaning that more people appear to be serious about buying in the near future. Builders remain very concerned, however, about the lack of available financing for new-home construction at a time when inventories of completed new homes are quite thin; after all, you can't sell what you can't build."
The index surveys builders on their perceptions of the housing market for the next six months. A number above 50 indicates a majority feel good about the market’s prospects.
Despite the continued overall weakness in the housing market, there where sections where builders saw some good signs, said David Crowe, the association’s chief economist.
"The most positive aspect of today's report is the future expectations component, which not only held onto the five-point gain it registered in October, but improved by an additional two points to 25 for November," Crowe said. "This is the highest that component of the HMI has been since the home buyer tax credit program spurred sales activity this spring."
But there are still ominous signs with the survey, he added.
"The most concerning aspect of the report is that survey participants say they have observed absolutely no improvement in their ability to access credit to build viable new projects,” he said. “This problem is clearly a roadblock to recovery in many markets."