Research >> Economics
Builder Confidence Unchanged in November
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In a survey in which most responses were received prior to congressional action to keep an important home buyer incentive alive, builder confidence in the market for newly built, single-family homes remained unchanged at a low level this November, the National Association of Home Builders (NAHB) reported today. The NAHB/Wells Fargo Housing Market Index (HMI) held flat at 17 while its component gauging sales expectations for the next six months rose two points from the previous month, to 28.
When the HMI survey was conducted at the beginning of this month, home builders were facing the imminent expiration of the $8,000 first-time home buyer tax credit at the end of November, with no guarantee that this valuable buyer incentive would be extended. Now that Congress has done its job by both extending the tax credit into next year and expanding eligibility for it among potential buyers, we are very hopeful that this will have the intended stimulative effect on sales activity going forward.
Today's report confirms that home builders and buyers were in something of a holding pattern in early November as the anticipated expiration of the tax credit drew near and congressional action had not yet taken place to address this. Meanwhile, the challenges that builders are facing in obtaining credit for new housing production and appropriate appraisal values for their homes continued to worsen. These issues still present a very worrisome problem that is weighing down prospects for a sustained housing market recovery.
Posted: November 17, 2009 Tuesday 01:00 PM