Builder confidence remained at a record-low level for the third straight month in December, according to the results of a monthly survey released today by the National Association of Home Builders in conjunction with Wells Fargo.
The NAHB/Wells Fargo Housing Market Index stood at 19 in December — a score below 50 indicates most builders view current and future market conditions as negative, while a score above 50 indicates most builders have a positive outlook. The index score during the past three months is the lowest in the 20-year history of the index.
The index score is based on builders’ survey responses of “good,” “fair” and “poor” to questions about the present state of the market for single-family new-home sales, the volume of traffic from prospective buyers to new homes, and the outlook for single-family new-home sales for the next six months.
Brian Catalde, NAHB president, said in a statement, “Builders continue to look for signs of improvement in the ongoing mortgage market crisis that is weighing on housing and the overall economy. Recent actions taken by Congress and the administration addressing certain aspects of the problem are definitely a step in the right direction.”
The index measuring builder confidence in the present state of the market for single-family new-home sales was 19, while the index score for the traffic of prospective buyers was 14; the index score for single-family new-home sales for the next six months was 26.
Regionally, the index was lowest in the Midwest, at 15; followed by the West, 18; Northeast, 19; and the South; 21. The Midwest and the South had two-point gains from November to December, according to the report, while the Northeast experienced a seven-point drop.
