Thanksgiving is a time to reflect and count blessings. Despite setbacks in labor and lot prices, 2019 gave the housing market hope. Builder confidence is at an 18-month high, and this year’s numbers show that it isn't just wishful thinking. While some homebuyers will still find the market to be unaffordable, the future of the 2020 market is looking brighter than before, especially if prices become more affordable to the middle class.
Aside from one disappointing month in the spring, 2019 has been a resurgent year for new home sales, and this stronger-than-expected October data — on the heels of strongly upwardly revised September data — only reinforces the trend and proves that high builder confidence is not entirely unwarranted. Yes, building conditions remain tough and the prices of land, labor and lumber are volatile. But homebuilder confidence is almost as high as it has been in more than 18 months, buoyed by their apparent expectations that people will remain eager to buy new homes through at least the beginning of 2020. Should the median price of new homes continue to flatten and stay closer to what middle-income buyers can afford – as it has for the better part of the last year and a half – this will be even more likely.