Home Builders More Confident
This report from the National Association of Home Builders is showing that the new home builders have a renewed confidence in the demand for homes. Home builders are at the front line of trying to determine the mood of the home buyers confidence. If the confidence is low then buyers will back off from looking at buying a home...but if they feel reasonably secure in their job and they see that the economy as a whole is improving then they may consider buying a new home.
The trickle down effect is huge because with new home starts on the rise this then has the multiplier effect for the whole economy as a new home requires not just the wood, drywall, shingles, bricks needed to construct the home, but all the peripheral supplies such as dishwashers, stoves, a/c units, landscaping, lighting fixtures. The new home is a veritable source of business for everyone. Then when the new owners move in they usually buy new furniture, maybe add new paint, add a fence to the back yard, upgrade some appliances etc.
This is what the report had to say:
"Builder confidence in the market for newly built, single-family homes continued to climb for a fourth consecutive month in January, rising four points to 25 on the NAHB/Wells Fargo Housing Market Index (HMI), released today. This is the highest level the index has attained since June of 2007.
"Builder confidence has now risen four months in a row, with the latest uptick being universally represented across every index component and region," noted Bob Nielsen, chairman of the National Association of Home Builders (NAHB) and a home builder from Reno, Nev. "This good news comes on the heels of several months of gains in single-family housing starts and sales, and is yet another indication of the gradual but steady improvement that is beginning to take hold in an increasing number of housing markets nationwide -- and that has been shown by our Improving Markets Index. Policymakers must now take every precaution to avoid derailing this nascent recovery."
Source: National Association of Home Builders
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