Slow Housing Recovery Keeps Builder Confidence on the RiseThursday, 21 August 2014 00:00
Since 2007 and 2008, when the housing economy began its sudden crash, it has been a slow climb back to recovery. Recent surveys conducted by the National Association of Home Builders (NAHB) have shown that the housing recovery continues on an upward cycle and that builder confidence is progressing in the same direction.
For this month, according to the NAHB/First American Leading Markets Index, the year-over-year progression in the housing market has seen 56 of the approximate 350 metro areas return or exceed their last normal level of economic and housing activity. There has also been a net gain of seven markets in the same time span.
Central Texas, where Design Tech Homes builds many of its custom homes, has seen massive gains. Odessa and Midland are two smaller metro areas that have double their housing strength since prior to the recession.
The housing market is currently running 89 percent of its normal economic and housing activity with 78 percent of markets experience year-over-year improvements.
This positive recovery over the year may be impacting the overall builder confidence as well. According to the NAHB/Wells Fargo Housing Market Index, builder confidence has risen two points to 55, which means that most builders consider the single-family housing industry as “good” over “fair.” The three options the NAHB provides regarding builder confidence is good, fair, or poor.
This current builder confidence index is the highest since January. The confidence level has also been on an increase for three consecutive months. The builder confidence increase could affect the buyer confidence as well.
“Things are gradually improving,” said NAHB Chairman Kevin Kelly in the recent NAHB press release. “As the job market grows, we expect to see a steady release of pent up demand of home buyers.”