Builder confidence for newly built single-family homes is on the decline, yet overall confidence is still very high. The National Association of Home Builders/Wells Fargo Housing Market Index (HMI) slipped two points in June to a reading of 64, the first month-to-month drop since December. However, this is the fifth consecutive month in the 60s.
"While demand for single-family homes remains sound, builders continue to report rising development and construction costs, with some additional concerns over trade issues," said NAHB Chairman Greg Ugalde in a release.
The three components that make up the HMI—current sales, future sales and buyer traffic—also declined slightly in June.
Despite the overall letdown in June, the three-month moving averages for the regional HMIs continued to show promise with two of the four reporting increases this month. The Northeast and Midwest each improved by three points to 60 and 57, respectively. The South declined one point to 67, while the West remained at 71.
"… [W]hile new home sales picked up in March and April, builders continue to grapple with excessive regulations, a shortage of lots and lack of skilled labor that are hurting affordability and depressing supply," said NAHB Chief Economist Robert Dietz in the release.
-Michael Miller, managing editor