Despite an uptick in the future expectations of the home construction industry, builder confidence edged lower at the beginning of April.
Overall builder confidence experienced a three-point decline this month to a level of 25 out of 100, according to a recent report from the National Association of Home Builders. The confidence level is now equal to where it was at the beginning of 2012, which is the highest the index has been since 2007.
Regionally, the Northeast was the only area to experience an increase in builder confidence, while confidence in the Midwest market remained unchanged. In contrast, the West and South regions both experienced notable declines, which was enough to bring down the overall average.
"Although builders in many markets are noting increased interest among potential buyers, consumers are still very hesitant to go forward with a purchase, and our members are realigning their expectations somewhat until they see more actual signed sales contracts," said NAHB chairman Barry Rutenberg.
Meanwhile, a recent forecast from Fitch Ratings anticipates the construction rate of new homes to surge 10 percent by the end of 2012, while home buying activity of the units is expected to rise 8 percent, as prospective buyers continue to capitalize on ideal lending conditions.
