Homebuilder Confidence Jumps to Highest Level in 20 Years
December 16, 2019
Historically low availability of homes, a strong economy, and millennials belated entering the home buying market all combined have homebuilders feeling more confident than they have in decades. Builder confidence for new single-family homes increased 5 points in December to 76, the highest level since 1999. The index is up 20 points over last December’s reading.
The index is based on homebuilders’ opinion of current sales conditions, sales expectations for the next six months, and buyer traffic. Despite the high reading, the homebuilding industry still faces headwinds. An economist for the National Association of Homebuilders highlights the challenges of constraints like labor shortages and low availability of land. These factors hurt affordability and hold back more robust construction.