The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) is reporting that builder confidence in the market for newly built single-family homes declined 2 points to a reading of 81 in June. This is its lowest level since August of 2020 and after builder confidence topped at a level of 90 last November. However, despite the decline, the reading above 80 is still a signal of strong demand in a housing market lacking inventory. In June, all three of the major HMI indices posted declines. The HMI index gauging current sales conditions fell two points to 86, the gauge charting sales expectations in the next six months posted a two-point decline to 79 and the component measuring traffic of prospective buyers dropped two points to 71. Looking at the three-month moving averages for regional HMI scores, the South rose one point to 85, the West fell one point to 89, the Midwest dropped three points to 72 and the Northeast posted a five-point decline to 78.
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Rising Material Challenges, Declining Builder Sentiment