Builder confidence is resurging, according to the latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index. The July Index reading was 65; in June, it was 64. At 51 or higher, the general outlook is positive.
 
"Builders report solid demand for single-family homes," says Greg Ugalde, chairman of the NAHB, in a statement. "However, they continue to grapple with labor shortages, a dearth of buildable lots and rising construction costs that are making it increasingly challenging to build homes at affordable price points relative to buyer incomes."
 
"Even as builders try to rein in costs, home prices continue to outpace incomes," said Robert Dietz, chief economist at the NAHB. "The current low mortgage interest rate environment should be getting more buyers off the sidelines, but they remain hesitant due to affordability concerns. Still, attractive rates should help spur new-home purchases in large metro suburban markets, where approximately one-third of new construction takes place."
 
Source: National Association of Home Builders

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