Homebuilder Confidence Surges From Increased Buyer Demand

Despite supply-chain disruptions and major land and labor shortages, home builders are reporting increased confidence with strong buyer demand, says CNBC. Builder sentiment rose 3 points to 83 on the NAHB/Wells Fargo Housing Market Index (HMI) as more buyer traffic continues to boost single-family home building.

Though market demand is growing, some builders are slowing sales to account for industry-wide shortages and backlogs before starting new projects. Current sale conditions and buyer traffic both increased 3 points, but without much available land, builders will face more construction challenges in the months ahead.

Higher prices and longer wait times do not appear to be turning buyers away from the nation’s homebuilders. With demand still surging, homebuilder confidence in the market for single-family homes rose more than expected in November, to the highest level since last May. 

Confidence rose 3 points to 83 on the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Anything above 50 is considered positive. Analyst expectations had been for it to remain unchanged at 80. Sentiment stood at 90 in November 2020.

“The solid market for home building continued in November despite ongoing supply-side challenges,” said NAHB Chairman Chuck Fowke, a homebuilder from Tampa, Florida. “Lack of resale inventory combined with strong consumer demand continues to boost single-family home building.”

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