Builder confidence in the market for new single-family homes was up six points to 35 in July's National Association of Home Builders/Wells Fargo Housing Market Index (HMI).
It was the largest one-month gain recorded by the index in nearly a decade, and brings the HMI to its highest since March of 2007.
"Builder confidence increased by solid margins in every region of the country in July as views of current sales conditions, prospects for future sales and traffic of prospective buyers all improved," said Barry Rutenberg, NAHB chairman and a home builder from Gainesville, FL. "This is greater evidence that the housing market has turned the corner as more buyers perceive the benefits of purchasing a newly built home while interest rates and prices are so favorable."
"Combined with the upward movement we've seen in other key housing indicators over the past six months, this report adds to the growing acknowledgement that housing - though still in a fragile stage of recovery - is returning to its more traditional role of leading the economy out of recession," noted NAHB Chief Economist David Crowe. "This is particularly encouraging at a time when other parts of the economy have begun to show softness, and is all the more reason that the challenges constraining housing's recovery - namely overly tight lending conditions, poor appraisals and the flow of distressed properties onto the market - need to be resolved."
Every HMI component was up in July:
* current sales conditions up 6 points to 37
* traffic of prospective buyers up 6 points to 29
* sales expectations for the next six months rose 11 points to 44
All U.S. regions showed HMI increases in July:
* Northeast up 8 points to 36
* Midwest up 3 points to 34
* South up 5 points to 32
* West up 12 points to 44
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