Home Builder Sentiment Dips
The National Association of Home Builders reported on Monday that sentiment among builders dipped in September as the housing market continues to struggle to gain a firmer footing in recovery. The NAHB / Wells Fargo Housing Market index slipped a full point to a reading of 14 this month, according to the report. The reading fell below the expectations of analysts taking part in a recent Thomson Reuters survey, who had projected a reading of 15 for the index.
Any reading of the builder sentiment index below 50 means more builders view conditions as poor than favorable, while a reading above 50 would indicate more view conditions as favorable. The index has remained mired in a range of 13 to 16 for six months now, and the last time the index was over 50 was in April 2006.
“Very little has changed in terms of housing market conditions so far this year,” noted NAHB Chairman Bob Nielsen in a statement. “Builders continue to confront the same challenges in accessing construction credit, obtaining accurate appraisal values for new homes, and competing against foreclosed properties that they have seen for some time.”
The index’s reading on builders’ expectations for sales over the next six months slipped from 19 to 17. The market continues to be hampered by a huge oversupply of homes for sale, a high foreclosure rate, which drags prices down, and high lending standards, leaving many buyers who would like to nuy a home unable to do so.