Home Builder Confidence, Does It Get Any Lower

Published on September 20, 2011 by

Home builder confidence 2000-2011

Home builders are less and less confident in the market as time goes on. For all of those talking about a floor or a recovery you may be mistaken. The interest rates continue to go lower and provide all the opportunity in the world for a recovery yet the distressed homes continues to linger and keep the market down.

The risk that builders would have to take on right now simply don't justify the reward. Credit is tight and competition from deeply discounted distressed homes have builders sitting on the sidelines willing to wait for better opportunities in the future. The home builder confidence report is made of 3 different surveys that include the following:

  1. How are market conditions for the sale of new homes today?
  2. How are market conditions for the sale of new homes in 6 months?
  3. How is prospective buyer foot traffic?

The home builder confidence has been extremely low for years now and it looks like it may remain that way for years to come. The last time the confidence number was above 50 was April 2006. If you are shopping for a new home then look for some serious discount and deals because there are so many opportunities available to buyers today.

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Filed under: Housing Analysis
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