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Builder confidence remains steady in January
Builder confidence remained steady in January, holding at his highest level in nearly seven years, but progress is being stymied somewhat by wrangling over fiscal policies.
Sentiment in the market for newly built, single-family homes remained at 47, according to the National Association of Home Builders/Wells Fargo housing index released on Wednesday.
After eight months of gains, the gauge of confidence held as its highest level since April 2006.
Any readings below 50 suggest negative sentiment about the housing market.
"Conditions in the housing market look much better now than at the beginning of 2012 and an increasing number of housing markets are showing signs of recovery, which should bode well for future home sales later this year,” said Barry Rutenberg, chairman of the NAHB and a home builder from Gainesville, Fla.
“However, uncertainties stemming from last month’s fiscal-cliff negotiations contributed to the pause in builder confidence and continuing discussions among policymakers related to spending cuts and the future of the mortgage interest deduction could put a damper on housing demand in the coming months," he said.
In addition to debt-ceiling talks, finding ways to pay for the remaining 10 months of a sequester and passing an omnibus spending package to cover spending for the rest of the fiscal year, the housing market faces other obstacles to a more robust recovery.
The index’s components were mixed in January.
The component gauging current sales conditions remained unchanged at 51.
Meanwhile, sentiment for sales expectations in the next six months fell one point to 49 and the component measuring the traffic of prospective buyers gained one point to 37.
The three-month moving average was up across all regions, with the Northeast and Midwest posting a two-point gain to 36 and 50, respectively.
The South's sentiment increased by three points to 49 while the West posted a four-point increase to 51.
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