The number of COVID-19 cases may still be rising significantly across many parts of the country, but home-builders’ outlook on the housing market continues to improve.

The National Association of Home Builders’ monthly confidence index rose 14 points to a reading of 72 in July, the trade group said Thursday.

“Builders are seeing strong traffic and lots of interest in new construction as existing home inventory remains lean,” NAHB Chairman Chuck Fowke, a custom home builder from Tampa, Fla, said in the report. “Moreover, builders in the Northeast and the Midwest are benefiting from demand that was sidelined during lockdowns in the spring.

Index readings above 50 are a sign of improving confidence, and a figure below that threshold would represent a declining outlook. In April, the index had fallen to its lowest level since June 2012. April was also the first time since 2014 that the index has dropped below 50, and the index stayed below that threshold in May.

Expectations of current single-family home sales jumped 16 points to 79. Builders’ views on the traffic of prospective buyers moved 15 points higher to a reading of 58.

Expectations of home sales in the next six months improved by a smaller amount, rising only seven points to a reading of 75.

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