Builder Confidence Matches All-Time High on Record Traffic

In a sign that housing continues to lead the economy forward, builder confidence in the market for newly-built single-family homes increased six points to 78 in August, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI). The HMI now stands at its highest reading in the 35-year history of the series, matching the record that was set in December 1998.

"The demand for new single-family homes continues to be strong, as low interest rates and a focus on the importance of housing has stoked buyer traffic to all-time highs as measured on the HMI," said NAHB chairman Chuck Fowke, a custom home builder from Tampa, Fla. "However, the V-shaped recovery for housing has produced a staggering increase for lumber prices, which have more than doubled since mid-April. Such cost increases could dampen momentum in the housing market this fall, despite historically low interest rates."