Builder confidence for newly built, single-family homes slipped for a second straight month in July to its lowest level since April 2009, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) released today.
The index was dragged lower thanks to continued competition from foreclosure/distressed properties selling for less than new homes, more hesitant buyers, and tight consumer credit.
Additionally, the expiration of the homebuyer tax credit has taken its toll, though it was recently extended for those already in contract until September 30.
“We continue to see a lull in home buying activity following the expiration of the federal home buyer tax credit program, as many of the sales that would have occurred this summer were likely pulled forward to meet that program’s deadline,” said NAHB Chairman Bob Jones, in a release.
“In addition, builders are reporting continuing consumer hesitancy regarding home purchases due to uncertainty in the overall economy and job markets.”
Not good news considering applications for home purchases have fallen in nine of the past 10 weeks to their lowest point since December 1996.
All that said, they still believe new home sales will rise 10 percent in 2010 compared with 2009, thanks to the record low mortgage rates and more affordable home prices.
