Homebuilder confidence is still in the dumps, according to April's National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index report released today.
After clocking in at a revised 46 points for March, April's reading managed to edge up just one point to 47. Analysts had been hoping for a significantly stronger rise to 49.
Any number over 50 indicates that more builders view sales conditions as good than poor, a point reached for the first time in June since April 2006. Since April's report is sub-50, homebuilders are generally pessimistic about sales. The survey looks at builder confidence in newly built single-family homes.
"Builder confidence has been in a holding pattern the past three months," said NAHB Chairman Kevin Kelly in a statement today. "Looking ahead, as the spring home buying season gets into full swing and demand increases, builders are expecting sales prospects to improve in the months ahead."
Digging deeper into components, current sales conditions stayed steady at 51 points, as did prospective buyer traffic at 52. In a sign of optimism ahead, future sales expectations for the next six months increased four points to 57.
NAHB Chief Economist David Crowe noted that the housing market may see an upturn thanks to a stronger labor market and affordable options:
Job growth is proceeding at a solid pace, mortgage interest rates remain historically low and home prices are affordable. While these factors point to a gradual improvement in housing demand, headwinds that are holding up a more robust recovery include ongoing tight credit conditions for home buyers and the fact that builders in many markets are facing a limited availability of lots and labor.