Home Builders Remain Pessimistic

By:
Kara Johnson | September 20, 2010

Homebuilders remain pessimistic about the outlook for their industry, overwhelmingly viewing market conditions over the next six months as poor. 

The newest National Association of Home Builders/Wells Fargo Housing Market Index, released today, showed builder’s confidence in the market remained unchanged in September, with the index remaining at 13, same as August. The 100-point scale assesses builder’s outlooks from poor to good, with lower scores equaling a more pessimistic outlook.
 
"In general, builders haven't seen any reason for improved optimism in market conditions over the past month,"said NAHB Chair Bob Jones. "If anything, consumer uncertainty has increased, and builders feel their hands are tied until potential home buyers feel more secure about the job market and economy."
 
Consumer uncertainty regarding employment and the large number of foreclosed properties coming to market were cited by builders as the major obstacles suppressing new home sales at the moment. However, NAHB chief economist David Crowe said an improving employment picture in the coming months should boost consumer confidence and improve conditions for new home sales in the final months of the year.
 
Homebuilders were most pessimistic in the Western region of the U.S., with an index score of eight, unchanged, and least pessimistic in the Northeast, with an index score of 16, although down two points from August. The index for the South rose two points to 14, while the Midwest declined three points to 12.

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