Homebuilder confidence is down slightly, according to January's National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index report released today.
After clocking in at a revised 57 points for December, January's 56 reading shows a fairly consistent level of confidence after a strong revised three-point gain from November to December. Analysts were slightly disappointed, however, having predicted a 57.5 reading. The overall index is nine points higher than a year ago, reflecting a stronger U.S. housing market.
Any number over 50 indicates that more builders view sales conditions as good than poor, a point reached for the first time in June 2013 since April 2006. The survey looks at builder confidence in newly built single-family homes.
"Following an unexpected jump last month, builder confidence has essentially leveled out and is holding at a solid level," said NAHB Chairman Rick Judson in a statement today. "Many markets continue to improve and this bodes well for future home sales."
Digging deeper into components, current sales conditions fell one point to 62 while prospective buyer traffic dipped three points to a low-confidence 40. Future sales expectations for the next six months edged down two points to remain in solid territory at 60 .
NAHB Chief Economist David Crowe says 2014 should see slow but steady improvements for the housing market:
Rising home prices, historically low mortgage rates and significant pent-up demand will drive a continuing, gradual recovery in the year ahead. However, the pace of the recovery could be stronger were it not for rising construction costs and inaccurate appraisals that are keeping some home sales from going through.
The spring buying and selling season kicks off next month, traditionally the time of the year that sets the tone for residential hiring and construction.
-- Material from The Associated Press was used in this report.