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Confidence among US homebuilders falls from five-month high

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Confidence among US homebuilders declined in July from a five-month high, showing the construction industry remains in a slow, if unspectacular, recovery as the busiest part of the selling season comes to a close, according to data Monday from the National Association of Home Builders/Wells Fargo.

[WASHINGTON] Confidence among US homebuilders declined in July from a five-month high, showing the construction industry remains in a slow, if unspectacular, recovery as the busiest part of the selling season comes to a close, according to data Monday from the National Association of Home Builders/Wells Fargo.

The NAHB index has held within a narrow range of 58 to 61 this year, signaling builders are generally positive about the outlook although there has been little additional momentum to propel sentiment to a higher level. Ultra-low mortgage rates, employment gains and a growing number of households as younger Americans start families will feed demand for housing, while slow wage growth and memories of the industry's collapse during the last recession remain restraints. The index reached a low of 8 in January 2009 and a high of 78 in 1998.

"For the past six months, builder confidence has remained in a relatively narrow positive range that is consistent with the ongoing gradual housing recovery that is underway," said NAHB Chairman Ed Brady, a homebuilder and developer from Bloomington, Illinois.

"However, we are still hearing reports from our members of scattered softness in some markets, due largely to regulatory constraints and shortages of lots and labor."

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