Builder confidence rose again in April MABA MassachusettsRealEstate #FirstTimeHomeBuyers MaBuyerAgent

Builder confidence in the market for newly built single-family homes rose for the fourth month in a row in April. Homebuilders remained cautiously optimistic that the lack of existing inventory would drive demand for new homes, despite elevated interest rates and construction costs, the National Association of Home Builders reported. Specifically, the NAHB/Wells Fargo Housing Market Index (HMI) rose one point to forty five. Any number over fifty indicates that more builders view conditions as “good,” rather than “poor.”

“Currently, one-third of housing inventory is new construction, compared to historical norms of a little more than ten percent,” NAHB Chief Economist Robert Dietz said in a press release. “More buyers looking at new homes, along with the use of sales incentives, have supported new home sales since the start of 2023.” The share of builders reducing home prices slid to thirty percent in April from thirty one percent in March and February. The average price reduction in April was six percent, the same as in February and March but lower than the eight percent seen in December. Meanwhile, the share of builders using incentives to bolster sales rose to fifty nine percent from fifty eight percent in March; it was sixty two percent in December.

The HMI is made up of three components, two of which rose in April. The component gauging current sales conditions rose two points to fifty one, and the gauge measuring sales expectations in the next six months rose three points to fifty. The component measuring traffic of prospective buyers was flat at thirty one. Regionally, the three-month moving average of the index rose in all geographic regions, rising four points to forty six in the Northeast, four points to forty nine in the South, four points to thirty eight in the West and two points to thirty seven in the Midwest.

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