Builders’ op­ti­mism slides for 4th straight month

Austin American-Statesman - - BUSINESS -

Home­builder con­fi­dence slid for the fourth con­sec­u­tive month with steadily ris­ing mort­gage rates and sky-high home prices putting own­er­ship out of reach for more and more Amer­i­cans.

The Na­tional As­so­ci­a­tion of Home Builders/Wells Fargo builder sen­ti­ment in­dex for April, re­leased Mon­day, fell one point to 69. Any read­ing above 50 in­di­cates more builders see sales con­di­tions as good rather than poor, but it’s the most ex­tended de­cline since the run-up to the hous­ing bust.

The in­dex has been above 60 since Septem­ber 2016 and hit a record high in De­cem­ber. April’s read­ing is the low­est since Novem­ber. Builders’ view of cur­rent sales con­di­tions fell two points to 75; the out­look for sales over the next six months fell one point, to 77.

The Na­tional As­so­ci­a­tion of Home­builders cited higher build- ing ma­te­rial costs and a lack of land to build on as key rea­sons for the nick in con­fi­dence read­ings.

The group said win­ter weather slowed build­ing in some ar­eas.

Also be­ing shaken are in­vestors, which have been sell­ing off hold­ings in the na­tion’s largest home­builders.

D.R. Horton Inc., Len­nar Corp., Pul­teGroup Inc., Toll Brothers Inc., Beazer Homes USA Inc. and Hov­na­nian En­ter­prises Inc. have all fallen 11 per­cent or more since the start of the year.

The av­er­age rate on 30-year, fixed-rate mort­gages edged up to 4.42 per­cent, mort­gage buyer Fred­die Mac re­ported Thurs­day. Rates have ticked steadily higher ahead of the tra­di­tional spring home-buy­ing sea­son.

While the Na­tional As­so­ci­a­tion of Real­tors re­ported a 3.1 per­cent jump in pend­ing sales for Fe­bru­ary; that fol­lowed a 5 per­cent tum­ble in Jan­uary and the in­dex is still down 4.1 per­cent com­pared with last year.

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