The August NAHB home builder survey rose to 37 from 35 in July and is better than estimate of 35. It’s the highest reading since Feb ’07 but of course remains well below 50. The Present view for single family sales rose 3 pts to 39 while the Outlook was up 1 pt to 44. Prospective Buyers Traffic gained 3 pts to 31 with increases in the Midwest and South while the Northeast and West were lower. The NAHB chief economist summed up the report with this, “This 4th consecutive increase in builder confidence provides further evidence of the gradual strengthening that’s occurring in many housing markets and providing a needed boost to local economies. However, we are still at a very fragile stage of this process and builders continue to express frustration regarding the inventory of distressed properties, inaccurate appraisal values, and the difficulty of accessing credit for both building and buying homes.”

Category: MacroNotes, Real Estate, Think Tank

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3 Responses to “Builder sentiment continues to creep higher”

  1. denim says:

    Homes need price support just as crops do for farmers. At the time of taking out a mortgage, there is a required mortgage insurance to protect the lender from borrower default. That would be an excellent time to require a no charge policy to protect the buyer from having the value of the home go below its original, new house price (that prevents funding a bubble). It would be valid only when the buyer has to resell the home. The government would have a home price support fund that would have extra money in it from the partial elimination of the curent IRS mortgage deduction that homeowners have on their home mortgage. The value of everyone’s home, regardless of being underwater or not, would be therefore increased in a fair manner without favoritism.

  2. Mike in Nola says:

    Don’t know how reliable builder sentiment is. Those guys certainly foresaw the end of the bubble, didn’t they.

    There seems to be a circle jerk in the housing market. They all keep telling one another how things are improving. Comparing the graph of the sentiment with actual completions seems to show a bit of a discrepancy. Chart courtesy of the US via ZH:

  3. Glen says:

    Bigger market for nicer refrigerator crates.

    All else means “private” builders get firmly latched onto the government teat. (And smoke dope – lots of dope.)