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U.S. builder confidence drops for 3rd straight month

Xinhua, March 17, 2015 Adjust font size:

U.S. builder confidence for newly-built, single-family homes fell in March for the third straight month, but builders remained optimistic about the spring buying season, a leading industry report said Monday.

The builder sentiment index fell two points to 53 this month, the lowest level since July, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Any reading over 50 indicates that more builders view sales conditions as good, rather than poor.

"Even with this slight slip, the HMI remains in positive territory and we expect the market to improve as we enter the spring buying season," said NAHB Chairman Tom Woods in a statement.

In March, the HMI index gauging view on current sales conditions dropped three points to 58, and the component measuring traffic of prospective buyers slipped two points to 37. The component gauging sales expectations for the next six months held steady at 59.

"The drop in builder confidence is largely attributable to supply chain issues, such as lot and labor shortages as well as tight underwriting standards," said NAHB's chief economist David Crowe, adding that the housing market is expected to improve in the year ahead, driven by "sustainable job growth, low mortgage interest rates and pent-up demand." Endite