Builder confidence in the market for new single-family homes hit an eight-year high in December — evidence that rising mortgage rates are not hampering the housing recovery, the National Association of Home Builders (NAHB) reported.
The index rose from a reading of 54 in November to 58 this month, the highest recorded since November 2005, according to historical data from the NAHB/Wells Fargo Housing Market Index.
The index gauges builders’ views of current sales conditions, sales expectations and traffic of prospective buyers. Builders’ confidence in all three of those market components improved in December, the NAHB said. An index score greater than 50 indicates that more builders view conditions as good than poor.
“This is definitely an encouraging sign as we move into 2014,” said NAHB Chairman Rick Judson. “The HMI is up 11 points since December of 2012 and has been above 50 for the past seven months. This indicates that an increasing number of builders have a positive view on where the industry is going.”
