Connect with us

Hi, what are you looking for?

The American GeniusThe American Genius

Economic News

Builder confidence unchanged in January: good news or bad?

Builder confidence did not rise, and did not fall, so is this good news or bad news for housing? The National Association of Home Builders offers data that will explain.

builder confidence

builder confidence

Builder confidence remain at highest levels in six years

According to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index, builder confidence regarding the market of newly built single family homes did not change in January, remaining at a level of 47 out of 100. The trade group reports that this means that following eight consecutive monthly gains, the index continues to hold at its highest level since April of 2006, although any reading under 50 means that more builders are pessimistic about the market than optimistic. Current readings show a split in the market, with roughly half reporting optimism, the other half reporting pessimism.

“Conditions in the housing market look much better now than at the beginning of 2012 and an increasing number of housing markets are showing signs of recovery, which should bode well for future home sales later this year,” Barry Rutenberg, chairman of the NAHB explains.

Rutenberg continued, “However, uncertainties stemming from last month’s fiscal cliff negotiations contributed to the pause in builder confidence and continuing discussions among policymakers related to spending cuts and the future of the mortgage interest deduction could put a damper on housing demand in the coming months.”

Builder confidence held back by economic uncertainty

“Builders’ sentiment remains very close to the index’s tipping point of 50, where an equal number of builders view conditions as good and poor, and fundamentals indicate continued momentum in housing this year,” said NAHB Chief Economist David Crowe. “However, persistently tight mortgage credit conditions, difficulties in obtaining accurate appraisals and the ongoing stalemate in Washington over critical economic concerns continue to impede the housing recovery.”

Advertisement. Scroll to continue reading.

The index’s components were mixed in January. The component gauging current sales conditions remained unchanged at 51. Meanwhile, the component gauging sales expectations in the next six months fell one point to 49 and the component gauging traffic of prospective buyers gained one point to 37.

The HMI three-month moving average was up across all regions, with the Northeast and Midwest posting a 2.0 point gain to 36 and 50, respectively. The South registered a 3.0 point gain to 49 and the West posted a 4.0 point increase to 51.

With lending conditions remaining tight and economic uncertainties stifling all industries, the housing sector remains in a challenging position as it marches down the long road to recovery, so builder confidence remaining unchanged is good news in light of the massive challenges on builders’ minds.

Advertisement. Scroll to continue reading.

Tara Steele is the News Director at The American Genius, covering entrepreneur, real estate, technology news and everything in between. If you'd like to reach Tara with a question, comment, press release or hot news tip, simply click the link below.



  1. JoeLoomer

    January 16, 2013 at 12:25 pm

    Find it strange they’re quoting January confidence in the first half of the month before folks have gotten serious about moving on from the holidays and getting back to their home search.

    Navy Chief, Navy Pride.

Leave a Reply

Your email address will not be published. Required fields are marked *


American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.



Real Estate Technology

(TECH NEWS) It turns out that Internet of Things, like smart bulbs in homes, are not secure and give up your info - here...

Real Estate Marketing

(MARKETING) Your fancy, self-animating website might be making people violently ill, even if it is insanely beautiful. Sorry...

Real Estate Marketing

(MARKETING) Conduit is a CRM that does more than CRM, it analyzes your networking data to help you see how to improve your relationships.

Real Estate Corporate

(REAL ESTATE) Zillow has long been a data powerhouse, but a lawsuit about a $150M listing offers a look into listings claims.

The American Genius is a strong news voice in the entrepreneur and tech world, offering meaningful, concise insight into emerging technologies, the digital economy, best practices, and a shifting business culture. We refuse to publish fluff, and our readers rely on us for inspiring action. Copyright © 2005-2022, The American Genius, LLC.