Homebuilders See Slight Improvement in Market Conditions

By:
Kara Johnson | October 18, 2010

Homebuilders are seeing a slight improvement in market conditions, although their outlook for the months ahead remains strongly pessimistic, according to new figures released today. 

Builder confidence in the market for single-family home construction rose three points in October, to a rating of 16 on the National Association of Home Builders/Wells Fargo Housing Market Index. Any score below 50 on the 100-point scale means more builders view market conditions as poor rather than good.
 
Even so, it was the first upturn in the Index in five months, bringing the rating back to the same level it had in June.
 
"Builders are starting to see some flickers of interest among potential buyers, and are hopeful that this interest will translate to more sales in the coming months," said NAHB Chair Bob Jones. "However, because most builders still have no access to credit for building homes, there is a real concern that we will not be able to meet the pent-up demand when consumers are ready to get back in the market.”
 
The overall index is composed of three elements. Builders were most positive about expectations for sales conditions over the next six months, with that index rising five points to 23. Assessments of current sales conditions rose three points to 16, while a gage of prospective buyer traffic rose only two points to 11.

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