Washington, DC, April 15, 2013 -- Facing increasing costs for building materials and rising concerns about the supply of developed lots and labor, home builder confidence fell in April, according to the National Association of Home Builders/Wells Fargo Housing Market Index.
“Many builders are expressing frustration over being unable to respond to the rising demand for new homes due to difficulties in obtaining construction credit, overly restrictive mortgage lending rules and construction costs that are increasing at a faster pace than appraised values,” said Rick Judson, National Association of Home Builders chairman.
“While sales conditions are generally improving, these challenges are holding back new building and job creation.”
NAHB Chief Economist David Crowes noted that supply chains for building materials, developed lots and skilled workers will take some time to re-establish themselves following the recession, and in the meantime builders are feeling squeezed by higher costs and limited availability issues.
“That said, builders’ outlook for the next six months has improved due to the low inventory of for-sale homes, rock bottom mortgage rates and rising consumer confidence,” Crowe said.
While the HMI component gauging current sales conditions declined two points to 45 and the component gauging buyer traffic declined four points to 30 in April, the component gauging sales expectations in the next six months posted a three-point gain to 53 – its highest level since February of 2007.