Home builders losing confidence in recovery

After three months of holding out steady hope, sentiment among U.S. home builders weakened slightly in May. A monthly index from the National Association of Home Builders slipped one point from a downwardly revised April figure. The index now stands at 45. Anything above 50 is considered positive sentiment.  “It is clear that builder sentiment is becoming more in line with the market reality of a continuing but modest recovery,” said NAHB Chairman Kevin Kelly, a home builder and developer from Wilmington, Del. “However, builders expressed some optimism that sales will pick up in the coming months.”  Builder confidence had moved well into positive territory throughout much of 2013, as prices soared on investor demand at the low end of the market. Home sales this spring have been decidedly weaker, as investors slow their purchases, leaving the market to mortgage-dependent, owner-occupant buyers.

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