Builder confidence hits six-year high

“At this point, difficult appraisals and tight lending conditions for builders and buyers remain limiting factors for the burgeoning housing recovery, along with shortages of buildable lots that have begun popping up in certain markets.”

The survey was conducted in the two weeks following Superstorm Sandy and reflects builder sentiment during that period.

Two out of three of the indexes posted gains in November. 

The component gauging current sales conditions posted the biggest increase, with an eight-point gain to 49 — highest mark in more than six years.

Meanwhile, the component measuring sales expectations for the next six months held above 50 for a third consecutive month, with a two-point gain to 53, and the component measuring traffic of prospective buyers held unchanged at 35 following a five-point gain in the previous month.

“Builders are reporting increasing demand for new homes as inventories of foreclosed and distressed properties begin to shrink in markets across the country,” said NAHB Chairman Barry Rutenberg, a home builder from Gainesville, Fla. 

“In view of the tightening supply and other improving conditions, many potential buyers who were on the fence are now motivated to move forward with a purchase in order to take advantage of today’s favorable prices and interest rates.”

All four regions of the country posted gains in the three-month moving averages. 

The South posted a four-point gain to 43, while the Midwest and West each posted three-point gains, to 45 and 47, respectively, and the Northeast posted a two-point gain to 31.