Builder confidence unexpectedly fell in February but did remain elevated, according to the National Association of Home Builders…(NAHB)
- Builder confidence fell one point to 82 in February, confidence has now fallen in the first two months of 2022.
- Economists had projected that confidence would remain at 83.
The West region lead all four regions for the second month in a row thanks to a two-point increase to 91 in February 2021…
- The South held on to the number two spot despite having the only drop of the month to 84 (-2) followed by the Northeast at 78(+7) and the Midwest at 71(+1).
Current conditions actually saw a slight uptick one point to 90 for the month. The overall decline was a result of short-term confidence as the 6-month index fell two points to 80, this is the lowest reading in 8 months.
Robert Dietz, NAHB Chief Economist, argues that costs and rates are up, but lack of inventory will propel building demand despite those factors…
- “Residential construction costs are up 21% on a year over year basis, and these higher development costs have hit first-time buyers particularly hard…Higher interest rates in 2022 will further reduce housing affordability even as demand remains solid due to a lack of resale inventory.”