Builder confidence remains near record low

Builder confidence remained steady in March, according to the latest National Association of Home Builders (NAHB)-Wells Fargo Housing Market Index report released Monday.

A rating below 50 signals builders view sales conditions as poor -- the index stood at 9 for March -- it was the fifth straight month the overall index has held steady. The index hit a record low at 8 in January.

The 20-year-old index has been in single-digit territory since November -- it averaged 72 during 2005.

The index gauges current builder sentiment in the market for newly built single-family homes from a set of survey questions. The survey focuses on buyer traffic, current sales conditions, and sales expectations for the next six months.

The index component gauging current sales conditions held at 7 in March, and the component gauging builders' sales expectations for the next six months held at 15. The component that focuses on buyer traffic dropped from 11 in February to 9 in March.

The results of another survey, released by John Burns Real Estate Consulting, found that builders are divided on whether a new $8,000 tax credit for first-time buyers (see Inman News article) will directly result in additional sales: 54 percent said they would not receive any new sales as a result, while 46 percent said they expected one to five sales per community in March as a result.

The March survey is based on responses from 218 builder executives from across the country who represent about 1,600 new-home communities in 80 metro areas. ...CONTINUED

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