US homebuilder confidence surges in July

Published on NewsOK Modified: July 16, 2014 at 9:40 am •  Published: July 16, 2014
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U.S. homebuilders' confidence in the housing market surged this month to the highest level since January, reflecting a pickup in sales of new homes and heightened expectations for sales the second half of the year.

The brighter sales outlook suggests home construction could pick up in coming months after a sluggish start this year.

The National Association of Home Builders/Wells Fargo builder sentiment index released Wednesday rose this month to 53, up four points from a revised reading of 49 in June.

Readings above 50 indicate more builders view sales conditions as good, rather than poor. The latest reading is the first above 50 since January, when it was 56.

Builders' view of current sales conditions for single-family homes, their outlook for sales over the next six months and traffic by prospective buyers each increased since June.

Higher mortgage rates and the bad weather weighed on home sales in late 2013 and early this year. Harsh winter weather also contributed to a sluggish start to this year's spring home-selling season.

But sales of new homes have picked up in recent months.

New home sales jumped 18.6 percent in May to a seasonally adjusted annual rate of 504,000, the highest level in six years. That followed a 3.7 percent increase in April. The gains came after declines in February and March.

Even with the big overall gain, sales of new homes are still running at just about half the pace of a healthy real estate market.

Still, the recent pickup in sales suggests that the housing recovery may be regaining its footing after slowing earlier this year.

Economists say there is significant pent-up demand for homes as many potential buyers put off purchases over the past few years because of concerns about the economy.

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