For those under the rater gloomy impression that the current housing recovery is no more than a passing fluke, one of the most important measures of confidence among builders is pointing to the exact opposite:
The housing recovery is real and here to stay.
This Monday saw the National Association of Home Builders’ index climbed to 52, which is the first time in over seven years that the index has topped 50. Anything higher than the key threshold of 50 indicates that a significant proportion of homebuilders deem the market’s sales performance as good, as opposed to poor.
The index has been steadily gaining over the course of the past 12-months, but it is only by passing the index’s milestone of 50 that the message has really started to hit home. Both builders and analysts have for the most part spoken with optimism for the housing market over recent months – not it appears the majority of those in the thick of the industry agree with their sentiments.
The month of June usually brings a significant slowdown in home sales after a busy spring home buying season. This year however has proved quite to the contrary, with sales conditions and market interest for June actually outperforming the levels recorded in May.
According to the results of the study, the NAHB reports that 41% of US builders taking part are confident in the positive conditions of the market – a massive increase on the 15% recorded last year. At the same time 12-month prior, at least triple the volume of builders stated that the conditions at the time were poor.
The news comes at the latest in a growing string of positive signs that the market is on its way back to strength, which include growing house prices, a decrease in foreclosures and a generally improved sales volume for new and used properties.
And what’s more, the ongoing uptick of mortgage rates doesn’t seem to have had any ill effects onbuyer interest.