Builder sentiment in the housing market for single-family units remained at 83 in May, according to the National Association of Home Builders press release. Current sales conditions remained unchanged at 88 as expectations for the next 6 months jumped 1 point to 81.
Buyer traffic slipped 1 point to 73.
Builder sentiment rose 1 point to 84 in the South and remained at 90 in the west on a 3-month average.
Sentiment declined 4 points to 82 in the Northeast and shed 3 points to 75 in the Midwest on a 3-month average.
Builders expect to receive more buyers due to the shortage of homes and continuation of low mortgage rates which have enhanced affordability.
Amid the strong builder’s confidence, rising material costs are pushing house prices higher, denting buying power.
Material costs are now 12% higher year over year straining builders and the overall market.
NAR’s Chuck Fowler has warned home buyers to expect prices to surge this year as the cost of materials, labor, and land rise.
SPDR Homebuilders ETF is currently declining. XHB is down 1.53%
