Reflecting rapidly rising interest rates combined with ongoing home price increases and higher construction costs, the National Association of Home Builders released a report on Monday showing a continued deterioration in U.S. homebuilder confidence in the month of April.
The report showed the NAHB/Wells Fargo Housing Market Index fell to 77 in April from 79 in March, with the decrease matching economist estimates.
The housing market index declined for the fourth consecutive month, sliding to its lowest level since hitting 76 last September.
“Despite low existing inventory, builders report sales traffic and current sales conditions have declined to their lowest points since last summer as a sharp jump in mortgage rates and persistent supply chain disruptions continue to unsettle the housing market,” said NAHB Chairman Jerry Konter.
He added, “Policymakers must take proactive steps to fix supply chain issues that will reduce the cost of development, stem the rise in home prices and allow builders to increase production.”
The continued decrease by the housing market index came as the component charting traffic of prospective buyers tumbled to 60 in April from 66 in March.
The index gauging current sales conditions also fell to 85 in April from 87 in March, while the gauge measuring sales expectations in the next six months rose to 73 from 70.
On Tuesday, the Commerce Department is scheduled to release its report on new residential construction in the month of March.
Housing starts are expected to slump by 1.8 percent to an annual rate of 1.738 million in March after spiking by 6.8 percent to a rate of 1.769 million in February.
Building permits, an indicator of future housing demand, are also expected to tumble by 2.1 percent to a rate of 1.820 million in March after falling by 1.9 percent to a rate of 1.859 million in February.
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