WASHINGTON - Builder confidence for newly built,
single-family homes dropped 1 point to 16 in December as continued
weakness in the economy and job markets weighed on consumers' potential
home buying plans, according to the latest NAHB/Wells Fargo Housing Market Index (HMI), released today.
"From an affordability standpoint, rarely has there been a better time
in history to purchase a home, thanks to record low interest rates,
attractive prices, and of course the recent extension and expansion of
the home buyer tax credit," said Joe Robson, chairman of the National
Association of Home Builders (NAHB) and a home builder from Tulsa, OK. "However, builders are not seeing the full impact of these conditions on
buyer demand, partly because awareness of the latest incentives is still
building, and partly because of concerns about job security and other
"As we anticipated, this is shaping up to be a bumpy recovery period for
the housing market," noted NAHB Chief Economist David Crowe. "While
some families may be just starting to factor the expanded tax credit
into their potential home buying plans, many are hesitating because of
the poor economy. At the same time, tight lending conditions for both
consumers and home builders continue to pose considerable obstacles on
the road to a sustained housing and economic recovery."
Regionally, December's HMI results were somewhat mixed. The Northeast
posted a 3-point gain to 23, while the West posted a 1-point gain
to 19, the South registered no change at 17, and the Midwest posted a 2-point decline, to 12.
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