Builder confidence on the rise

The recently released National Association of Home Builders/Wells Fargo Housing Market Index for July showed builder confidence in the market for newly built, single-family homes rose two points to 15, ending a three-month dip.

The index gauges current builder perceptions on home sales and sales expectations for the next six months, as well as buyer traffic and anticipated buyer traffic. The perspective on current sales rose two points, and expectations on home sales for the next six months rose seven points.

Bob Nielsen, chairman of the NAHB, said builders are facing competition from low priced foreclosures, inaccurate appraisals and a restrictive lending environment, but the market show signs of improvement.

"We view the upward movement in the July HMI as a correction from an exceptionally weak number in June that was at least partly attributable to negative economic news and the close of a disappointing spring selling season," said NAHB Chief Economist David Crowe. "Basically, the market continues to bounce along the bottom, with conditions in some locations beginning to improve."

One such market that has shown significant signs of improvement is the Iowa housing market. According to the Iowa Association of Realtors June 2011 Housing Trends Report, the statewide average price on homes in June was up 7.6 percent from May. The total number of homes sold also increased by 12 percent, making June 2011 the highest home-selling month in Iowa since June 2010.  

More News