US homebuilder confidence jumps in June, NAHB says

19th Jun 2023 15:38

(Sharecast News) - Homebuilder confidence in the States moved back into positive territory for the first time in 11 months, helped by a dearth of housing inventory and improving supply chain efficiencies.

The National Association of Home Builders/Wells Fargo Housing Market Index jumped by five points in June to reach 55.

That was better than the 51 point reading penciled in by economists and up from 50 points in May.

"This month marks the first time in a year that both the current and future sales components of the HMI have exceeded 60, as some buyers adjust to a new normal in terms of interest rates," said Robert Dietz, the business lobby's chief economist.

"The Federal Reserve nearing the end of its tightening cycle is also good news for future market conditions in terms of mortgage rates and the cost of financing for builder and developer loans."

Dietz also emphasised the "critical" role of home building for the inflation outlook.

In his view, policymakers could play an important role by helping to resolve supply chain issues, the shortage of skilled labour and by eliminating inefficient regulation such as exclusionary zoning policies.