Strong buyer demand pushed builder confidence up in April even as builders continued to grapple with rising lumber prices and supply chain issues and consumers faced higher home prices due to a lack inventory. The latest National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) shows that builder confidence in the market for newly built single-family homes rose one point to 83 in April.
Despite strong buyer traffic, builders continue to face challenges to add much needed housing supply to the market. The supply chain for residential construction is tight, particularly regarding the cost and availability of lumber, appliances, and other building materials. While mortgage interest rates have trended higher since February and home prices continue to outstrip inflation, housing demand appears to be solid for now as buyer traffic reached its highest level since November. NAHB’s forecast is for ongoing growth in single-family construction in 2021, albeit at a lower growth rate than realized in 2020. [read more on Eyeonhousing.org]
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