Strong consumer demand helped to boost builder confidence higher in October despite increasing material prices and shortages.
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Home builder confidence rose four points higher in October to 80 in the NAHB/Wells Fargo Housing Market Index.
The NAHB/Wells Fargo HMI measures builder perceptions of current single-family home sales and sales expectations for the next six months. Scores over 50 signal that more builders view conditions as good than poor.
NAHB Chairman Chuck Fowke stated that even though demand and home sales remain strong, builders continue to struggle with supply chain disruptions and labor shortages that are increasing pressure on building materials and home prices.
The three main components of HMI indices recorded gains in October. The index measuring current sales conditions rose to 87, the component measuring sales expectations gained three points to 84, and the gauge for prospective buyers moved up four points higher to 65.
The Midwest region posted a one-point increase in the three-month HMI scores, and the Northeast remained steady at 72. While, the South and West remained the same at 80 and 83, respectively.