Confidence among home builders has recovered somewhat after last month’s record-breaking decline even as much of the country remains under stay-at-home orders because of the coronavirus pandemic.
The National Association of Home Builders’ monthly confidence index rose seven points to a reading of 37 in May, the trade group said Monday. April’s figure had represented the lowest index reading since June 2012.
“The fact that most states classified housing as an essential business during this crisis helped to keep many residential construction workers on the job, and this is reflected in our latest builder survey,” Dean Mon, the association’s Chairman and a home builder from Shrewsbury, N.J., said in the report.
Index readings above 50 indicate improving confidence, while a figure below that threshold would signal the opposite. Last month was the first time since 2014 that the index has dropped below 50.
The indicator that measures current sales conditions increased six points to 42, while the component that gauges sales expectations in the next six months jumped 10 points to 46. The index that follows traffic of prospective buyers rose eight points to 21.
Regionally, the West posted the largest gain, increasing 12 points, followed by the Midwest and the South. Builder confidence in the Northeast — where New York state has been particularly hard hit by the coronavirus — dropped two points.