U.S. builders' confidence in the market for new single-family homes rose slightly in October to a six-year high, a trade association survey issued Tuesday said.
The National Association of Home Builders said the Home Builders/Wells Fargo Housing Market Index for builder confidence rose for a sixth consecutive month, adding 1 point to reach 41 -- its highest level since June 2006.
NAHB Chairman Barry Rutenberg said in a news release many builders report greater numbers of "serious buyers" visiting their sales offices "and the overall confidence measure is much higher than it was at this time last year."
Rutenberg said even though demand is increasing for new homes, new building is being held back by concern over "tight credit conditions."
"The slight gain in builder confidence this month is an indication that, while still moving forward, the speed at which the housing recovery is proceeding is being moderated by the various constraints such as tight credit, difficult appraisals and more recently, the limited inventory of buildable lots in certain markets," said NAHB Chief Economist David Crowe.
The NAHB/Wells Fargo Housing Market Index is based on a monthly NAHB survey measuring builder perceptions of current single-family home sales and sales expectations for the next six months. A number over 50 indicates a majority of builders perceive sales conditions as good, the association said.
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