Builder confidence in the market for newly-built single-family homes inched up by one point to 66 in August, according to the latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).
Among the different components of the overall index, the HMI gauging current sales conditions increased two points to 73 and the component measuring traffic of prospective buyers also increased two points to 50. However, the measure charting sales expectations in the next six months fell one point to 70. Looking at the three-month moving averages for regional HMI scores, the South moved one point higher to 69, the West was also up one point to 73 and the Midwest inched up a single point to 57, while the Northeast dropped three points to 57.
“While 30-year mortgage rates have dropped from 4.1 percent down to 3.6 percent during the past four months, we have not seen an equivalent higher pace of building activity because the rate declines occurred due to economic uncertainty stemming largely from growing trade concerns,” said NAHB Chief Economist Robert Dietz. “Although affordability headwinds remain a challenge, demand is good and growing at lower price points and for smaller homes.”