Home builders’ confidence surges thanks to better jobs market
Home builders’ confidence in the housing market surged in July, thanks in part to robust jobs growth in June.
The National Association of Home Builders/Wells Fargo Housing Market Index gained four points in July, hitting 53. That’s the first time it’s cleared 50 — the dividing line between good sales conditions for new single-family homes and poor sales conditions — since January.
NAHB Chairman Kevin Kelly, a home builder from Wilmington, Del., said the better-than-expected jump in the index shows that home builders’ confidence is “strengthening as pent-up demand brings more buyers into the marketplace.”
“As employment increases and those with jobs feel more secure about their own economic situation, they are more likely to feel comfortable about buying a home,” said NAHB Chief Economist David Crowe.
All three components of the Housing Market Index increased in July, with the biggest gain coming in expectations for future sales, which jumped six points to 64. Current sales conditions gained four points to 57, while traffic of potential buyers rose three points to 39.
The most confident home builders are in the West and South, followed by the Midwest. The Northeast lags behind the other regions.