US homebuilder sentiment slips; outlook remains positive

AP News
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Posted: Jan 17, 2018 10:49 AM
US homebuilder sentiment slips; outlook remains positive

U.S. homebuilders are feeling slightly less optimistic about their sales prospects, even as their overall outlook remains favorable ahead of the spring homebuying season.

The National Association of Home Builders/Wells Fargo builder sentiment index released Wednesday slipped this month to 72. That's down two points from December's reading, which marked an 18-year high for optimism among the nation's builders.

Readings above 50 indicate more builders see sales conditions as good rather than poor. The index has remained above 60 since September 2016.

The two-point January decline was anticipated by analysts surveyed by FactSet.

Builders' view of current sales conditions, their outlook for sales over the next six months, and a measure of traffic by prospective buyers also fell.

Americans stepped up their purchases of new homes at the fastest pace in more than 25 years in November, with sales skyrocketing 17.5 percent amid robust demand and a significant shortage of existing homes on the market.

Sales of new homes jumped to a seasonally adjusted annual rate of 733,000 units, compared with 624,000 in October. That's the biggest monthly gain since January 1992 and the most homes sold in a month since July 2007, just months before global economic turmoil decimated the housing market. December new-home sales figures are due out next week.

Many buyers, unable to find existing homes on the market, are turning to houses and condos. However, new construction has been unable to keep up with demand.

And competition to find any home, with the unemployment rate at its lowest point since 2000, is growing tougher as prices rise.

This month's builder index was based on 355 respondents.

The reading gauging builders' view of single-family home sales rose fell one point to 79, while the outlook for sales over the next six months slipped one point to 78. The measure of traffic by prospective buyers declined four points to 54.