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U.S. builder confidence continues to surge in August

08-16-2012 08:19 BJT

WASHINGTON, Aug. 15 (Xinhua) -- U.S. builder confidence in the market for newly built, single-family homes in August showed the fourth consecutive monthly gain, a leading industry report revealed on Wednesday.

The builder sentiment index ticked up two points to 37 in August, which was the highest level since February 2007 and indicated an improving outlook for housing construction, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI).

"This fourth consecutive increase in builder confidence provides further evidence of the gradual strengthening that's occurring in many housing markets and providing a needed boost to local economies," said the NAHB's chief economist David Crowe.

In August each HMI component saw gains. The components gauging current sales conditions and traffic of prospective buyers each rose three points to 39 and 31, respectively, and the component measuring sales expectation for the next six months inched up one point to 44. All three were at their highest levels in more than five years.

With constant modest improvement recently, the U.S. housing crash is believed to be near the bottom. However, many economists hold that the market still needs years to recover entirely as the bottom will be prolonged.

Crowe also said that the industry was still "at a very fragile stage of this process and builders continue to express frustration regarding the inventory of distressed properties, inaccurate appraisal values, and the difficulty of accessing credit for both building and buying homes."

Any reading below 50 indicates negative sentiment about the market. The index hasn't rebounded above that level since April 2006.

"While there is still much room for improvement, we have come a long way from the depths of the recession and the outlook appears to be brightening," said the NHAB's chairman Barry Rutenberg.



Editor:James |Source: Xinhua

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