U.S. Builder Confidence Rises To Record Level

In another sign that housing continues to lead the economy forward, U.S. builder confidence in the market for newly-built single-family homes increased five points to 90 in November, shattering the previous all-time of 85 recorded in October, says the NAHB/Wells Fargo ‘Housing Market Index (HMI)’. Builder confidence levels have hit successive all-time highs over the past three months. “Historically low mortgage rates, favourable demographics, and an ongoing suburban shift for home buyer preferences have spurred demand and increased new home sales by nearly 17 per cent in 2020 on a year-to-date basis,” says Chuck Fowke, chairman of the NAHB. “Though builders continue to sign sales contracts at a solid pace, lot and material availability is holding back some building activity. Looking ahead to next year, regulatory policy risk will be a key concern given these supply-side constraints.” All the HMI indices posted their highest readings ever in November. The HMI index gauging current sales conditions rose six points to 96, the component measuring sales expectations in the next six months increased one point to 89, and the measure charting traffic of prospective buyers rose three points to 77.