U.S. Home Builders' Confidence
Slips for First Time in 6 Months
By CAMPION WALSH
March 19, 2007
U.S. home builders' confidence slipped in March for the first time in six months, reflecting worry about worsening credit in subprime-mortgage markets, according to an industry survey released Monday.
The National Association of Home Builders' index of sales activity for new, single-family housing fell to 36 this month from a downwardly revised 39 last month, initially reported as 40.
When the NAHB's housing market index is under 50, the number of builders who see "poor" sales outnumber the number who see "good" sales. With housing markets cooling over the past year, the index has stayed under this threshold for 11 straight months after holding above it the previous 10 years.
"Builders are uncertain about the consequences of tightening mortgage-lending standards for their home sales down the line, and some are already seeing effects of the subprime shakeout on current sales activity," said NAHB Chief Economist David Seiders.
The NAHB still forecasts "modest improvements" in home sales for the rest of this year, though mortgage-market problems have increased the uncertainty of this outlook, Mr. Seiders said. Housing markets continue to have support from favorable interest rates, solid jobs growth and household income, lower energy prices and more affordable homes, he said.
Within the total housing-market index, all three national components declined during March after rising the previous month.
The component for present sales of single-family homes fell three points to 37. The index of sales expectations for the next six months fell three points to 50. And the index for traffic of prospective buyers fell one point to 28.
Regionally, the South and Northeast were weaker, while the Midwest and West eked out small gains. The South declined four points to 40, and the Northeast fell two points to 41. The Midwest and West each rose one point, to 28 and 36, respectively. The numbers are adjusted for seasonal variations.
The index was based on a survey of 375 home builders, who answered questions about sales prospects now and in the near-term.
Slips for First Time in 6 Months
By CAMPION WALSH
March 19, 2007
U.S. home builders' confidence slipped in March for the first time in six months, reflecting worry about worsening credit in subprime-mortgage markets, according to an industry survey released Monday.
The National Association of Home Builders' index of sales activity for new, single-family housing fell to 36 this month from a downwardly revised 39 last month, initially reported as 40.
When the NAHB's housing market index is under 50, the number of builders who see "poor" sales outnumber the number who see "good" sales. With housing markets cooling over the past year, the index has stayed under this threshold for 11 straight months after holding above it the previous 10 years.
"Builders are uncertain about the consequences of tightening mortgage-lending standards for their home sales down the line, and some are already seeing effects of the subprime shakeout on current sales activity," said NAHB Chief Economist David Seiders.
The NAHB still forecasts "modest improvements" in home sales for the rest of this year, though mortgage-market problems have increased the uncertainty of this outlook, Mr. Seiders said. Housing markets continue to have support from favorable interest rates, solid jobs growth and household income, lower energy prices and more affordable homes, he said.
Within the total housing-market index, all three national components declined during March after rising the previous month.
The component for present sales of single-family homes fell three points to 37. The index of sales expectations for the next six months fell three points to 50. And the index for traffic of prospective buyers fell one point to 28.
Regionally, the South and Northeast were weaker, while the Midwest and West eked out small gains. The South declined four points to 40, and the Northeast fell two points to 41. The Midwest and West each rose one point, to 28 and 36, respectively. The numbers are adjusted for seasonal variations.
The index was based on a survey of 375 home builders, who answered questions about sales prospects now and in the near-term.
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