Confidence among U.S. homebuilders is swelling to a
five-year high, with many now anticipating that sales of new homes will
strengthen this year even as signs point to a slowing economy.
The NAHB/Wells Fargo builder sentiment index surged six
points this month to 35, the highest reading since March 2007, the trade
association said Tuesday.
The index, which is based on responses from 318 builders,
rose from a reading of 29 last month, marking the largest one-month gain in
nearly a decade. It has declined only once between January and July.
Any reading below 50 indicates negative sentiment about the
housing market. And the index hasn’t reached that level since April 2006, the
peak of the housing boom.
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| This is my “below 50% happy face” |
In July, builders say they observed the best sales levels
since February 2007. Their outlook for sales in the next six months also brightened
to the highest level since March 2007. Turnout by prospective buyers also
returned to a level not seen in five years.
