Homebuilder confidence in the market of new single-family homes stabilized in the month of January, increasing two points to 58, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index.
The group index was held steady by decreasing mortgage rates and comes after a steady decrease in confidence in November and December 2018.
“The gradual decline in mortgage rates in recent weeks helped to sustain builder sentiment,” NAHB Chairman Randy Noel said. “Low unemployment, solid job growth and favorable demographics should support housing demand in the coming months.”
NAHB Chief Economist Robert Dietz explained that builders need to rein in increasing construction costs to keep home prices affordable for young prospective homebuyers.
“Builders need to continue to manage rising construction costs to keep home prices affordable, particularly for young buyers at the entry-level of the market,” Dietz said. “Lower interest rates that peaked around 5% in mid-November and have since fallen to just below 4.5% will help the housing market continue to grow at a modest clip as we enter the new year.”
Read more in Housing Wire.