Builder confidence in the single-family new-home market ticked up by only one point in March as builders remain concerned about several challenges in the sector, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
“The March HMI mirrors last month’s sentiment, as builders continued to be affected by poor weather and difficulties in finding lots and labor,” says NAHB Chairman Kevin Kelly.
Several factors are raising concerns about meeting demand for the spring buying season, says NAHB Chief Economist David Crowe.
“These include a shortage of buildable lots and skilled workers, rising materials prices and an extremely low inventory of new homes for sale,” Crowe says.
NAHB’s index gauges builder perceptions of current single-family home sales and sales expectations for the next six months, as well as buyer traffic. Sentiment in March was 47; any number below 50 indicates that more builders view conditions as poor than good.
Broken out, the component gauging current sales conditions was 52 in March; the component measuring sales expectations for the next six months was 53; and the component measuring buyer traffic rose two points to 33.