Home Builder Sentiment Rising in May After Record Drop in April
After the coronavirus knocked the housing industry off of its feet in March and April, home builder sentiment is still shaky, but builders are regaining confidence as demand starts to bounce back. Confidence in the market for single-family, newly built homes rose seven points in May after the sharpest one-month drop in the history of the National Association of Home Builders/Wells Fargo Housing Market Index, according to CNBC. The index reading of 37 is still well below a positive reading of 50, especially after a recent high of 76 in December. But after the 42 point plummet in April, a seven point climb is more than welcome.
After the sharpest one-month drop in the history of the index in April, homebuilder sentiment bounced back slightly in May as builders saw a quick rebound in interest from buyers.
Confidence in the market for single-family, newly built homes rose 7 points in May to 37, according to the National Association of Home Builders/Wells Fargo Housing Market Index. Anything above 50 is considered positive, so sentiment remains in negative territory. The index stood at 66 in May 2019 and hit a recent high of 76 in December.
Sentiment plunged an unprecedented 42 points in April, as the coronavirus pandemic shut down much of the economy and job losses soared. Homebuilding continued, deemed an essential business, but buyers pulled back decisively. Now, buyers appear to be shopping again — in person and virtually. Record low mortgage rates are also helping with affordability.