I know what you’re saying- builder confidence rates, builder schmonfidence rates, right? Who cares? You should. Hear me out… although it doesn’t directly impact you what Joe Builder thinks about the market, it is an economic indicator worth looking at.
Builder confidence is measured by surveying builders about their confidence in sales for the next six months as well as their confidence in foot traffic. According to the National Association of Home Builders (NAHB), builder confidence remains low but stable and not declining.
The confidence is an indicator that is newsworthy and we encourage you to follow here at AG because these are the people on the front line. They’re the ones having to battle banks with an axe to get any funding and they’re the ones who see mass buyers shopping whether they have agents or not.
The foot soldiers of the industry have had to live a lean, lean life, and their ability to have any optimism in the market should be closely noted.
If a struggling small builder believes a turnaround is coming based on the indicators at their fingertips that they live out daily, it should be closely noted.
This is one of the sectors that has been hardest hit by the recession. When a big builder that has gone through mass layoffs and budget cuts believes that foot traffic is going to decline but they’re still going to build, that’s a good sign.
Stability in confidence is a really good thing right now, even if that confidence is not skyrocketing. What say you?
