WASHINGTON – U.S. homebuilders’ confidence in the housing market rose modestly in April but remained at low levels for the third consecutive month, constrained by tight credit for home buyers and a shortage of workers and available land.
The National Association of Home Builders/Wells Fargo builder sentiment index, which measures confidence in the single-family home market, edged up to 47 in April from 46 in March, the homebuilders group reported last week.
Readings below 50 mean builders view sales conditions as poor. The index had been above 50 from June through January.
Builders recently have complained that they can’t find enough workers or lots to build on.
Many homebuyers also have had trouble qualifying for mortgages. The homebuilders’ index of traffic by prospective buyers stayed at 32 in April.
The latest reading, based on responses from 301 builders, comes as the spring home-selling season gets going. The season typically sets the pattern for residential hiring and building construction in the ensuing months.
The overall confidence index was below 50 in all four regions of the United States – 36 in the Northeast, 45 in the West and 48 in the Midwest and South.
“Builder confidence has been in a holding pattern the past three months,” said Kevin Kelly, chairman of the homebuilders association and a developer from Wilmington, Del. “Looking ahead, as the spring homebuying season gets into full swing and demand increases, builders are expecting sales prospects to improve in the months ahead.”
The index measuring their confidence in home sales over the next six months rose to 57, the highest since January.