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| June HMI shows steep decline in homebuilder confidence | |
| Wednesday, June 16, 2010 | |
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| WASHINGTON — According to the latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI), builder confidence in the market for newly built, single family homes fell sharply in June as the popular homebuyer tax credit expired. The HMI dropped five points to 17 in June. Derived from a monthly survey that NAHB has been conducting for more than 20 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor. “We expected some softening in the market following the expiration of the home buyer tax credit and this report seems to verify this assumption,” said NAHB Chief Economist David Crowe.“In the coming months, an improving economy, rising employment, low mortgage rates and stabilizing home values should help the housing market move forward. But as today’s HMI data shows, builders still remain very cautious and are aware that several factors could impede the nascent housing recovery, including serious problems in obtaining financing for the production of housing, faulty appraisal practices and competition from short sales and foreclosed properties.” To read the entire article, click here. For related information, click here. | |
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