Builder confidence in the market for new single-family homes rose strongly in early April, according to the National Association of Home Builders’ latest Housing Market Index. The HMI rose five points to 69 in April, bringing it back to levels seen in late 2003 and January 2004.
“Favorable interest rates and strong home-price appreciation definitely are still driving demand in today’s housing market, despite the recent bump-up in mortgage rates,” said NAHB President Bobby Rayburn. “Builders actually saw quite a few buyers hurrying to lock in financing as mortgage rates firmed up.”
The NAHB predicts that the trend is likely to continue despite rapidly rising mortgage rates.
“We expect the demand for single-family homes to remain quite strong in coming months, despite the rise in long-term mortgage rates, as growth in employment and household income accelerates,” said NAHB Chief Economist David Seiders.