Home-Builder Confidence in the Dumps

Home-builder confidence plunged to a 17-month low in August, according to a report released by The National Association of Home Builders. Builder confidence in the market for newly built, single-family homes edged down for a third consecutive month, as the NAHB/Wells Fargo Housing Market Index dropped one point to 13, its lowest level since March 2009. “Today’s report reflects single-family home builders’ concerns about current and future economic conditions and about the increasing hesitancy they are seeing among potential home buyers,” said NAHB Chief Economist David Crowe. “It also reflects the frustration that builders are feeling regarding the effects that foreclosed property sales are having on the new-homes market, with 87 percent of respondents reporting that their market has been negatively impacted by foreclosures.” Still, NAHB continues to project that modest job gains, historically low mortgage rates and pent-up demand will ensure a better housing market in the second half of 2010 than in the first half.