U.S. Builder Confidence Falls to 8-Year Low
U.S. builder confidence for new single-family homes in April fell 42 points from March to 30 points on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). This marks the largest one-month decline in the history of the index and the lowest reading since June 2012. Concerns due to the coronavirus outbreak are influencing builder confidence, with related unemployment and supply chain issues affecting construction activities.
The HMI component gauging current sales conditions plummeted 43 points to 36, while the measurement of sales expectations in the next six months dropped 39 points from March to 36. The component measuring prospective buyer traffic was also down 43 points from March to 13.
Derived from a monthly NAHB survey, the HMI gauges builder perceptions of current single-family home sales and sales expectations for the next six months. Scores from each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good rather than poor. See NAHB