The Big Picture - Macro Perspective on the Capital Markets, Economy, Technology, and Digital Media

After rising to the highest level since May ’10 in Nov, the Nat’l Assoc of Home Builders Index rose another 2 pts to 21. While sentiment has recently improved, the figure still remains well below the breakeven of 50. Both the Present outlook and Future expectations components rose slightly and the Prospective Buyers Traffic was up 3 pts to 18, the most since May ’08. The Chairman of the NAHB said while builder confidence remains low, “the consistent gains registered over the past several months are an indication that pockets of recovery are slowly starting to emerge in scattered housing markets…However the difficulties that both builders and buyers continue to experience in accessing credit for new homes are holding back potential sales even in areas where economic conditions are improving.” Builders also face the competition of foreclosures, consumer concerns with job security and the difficulty of selling one’s existing home so they can buy a new one.