Homebuilders are more confident in the market for new, single-family homes than they have been since the peak of the housing bubble 10 years ago, the National Association of Home Builders reported on Thursday.
The NAHB/Wells Fargo Housing Market Index reached a level of 60 in July. A reading of 50 or greater means more builders are optimistic rather than negative about their prospects for new home sales over the next six months.
At the same time, NAHB revised the June index to 60, from 59, for an even better showing when compared with the two-point drop — to 54 — in builder confidence in May.
NAHB Chairman Tom Woods said the burst of builder optimism aligns with positive market conditions. Sales of both new and existing homes surged in May and again in June as job growth continued — making potential buyers more confident about purchasing their first properties.
Woods predicted “a continuing recovery of the housing market” for the second half of 2015, a forecast that mirrors that of most economists.
The results also coincided with reports from the Federal Reserve’s July Beige Book — released Wednesday — which found that home sales grew in the majority of the 12 districts it surveyed. However, a significant number of those regions also reported they are still facing significant challenges due to the ongoing labor shortage.