U.S. home builders’ confidence hit a ten year high in June, after a slow down in the winter. The National Association of Home Builders’ confidence index asks home builders whether they are optimistic about the market for newly built, single-family homes in the six month period ahead. If more than half of those polled are optimistic, the index will be above 50. The index reached 59 in June.
The last time sales expectations were this high was in the last quarter of 2005, which is incredible news, especially considering the caution that these builders have learned since the recession. They remain conscious of the trends among buyers, including the strengths and challenges faced by those who want to buy a new home.
The report doesn’t just include overall confidence. There are other expectations. For example, expectations for sales were up six points to 69, buyer traffic was up five points to 44, and current sales conditions went up seven points to 65. Builders aren’t the only ones who are optimistic. Many analysts expect strong performance throughout the summer and onward. The National Association of Realtors reported a nine-year high in their pending home sales index in the month of April. The Realtors group predicts existing home sales to reach their highest level since 2006. The list goes on and on. There are other kinds of market evidence that are clear for everyone to see, such as rising demand and subsequent rising prices.
The only factor that seems to be lagging in relation to all of this is construction. Builders may be optimistic, but they are still constructing new homes at a slower pace than their perceived demand would warrant. Hopefully, they will step things up and we’ll see some new job creation as an added benefit.
If you’re in the market for West Maui real estate in these strengthening conditions, it’s more important than ever to work with expert realtors to help you make the most of your investment. For that, you’ll find our contact information at the bottom of the page. We would love to put our decades of experience to work for you. Mahalo!