Builder sentiment edged up just one point in October, according to an industry association index.Current sales conditions remained unchanged, sales expectations over the next six months fell one point, and buyer traffic gained one point. Regionally, home builders were less confident in the Northeast and Midwest, but gained confidence in the South and particularly in the West where the index jumped 14 points, well into the positive range.
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"House price improvement has been the biggest reason we've seen more confidence improving in general, and prices are taking a stronger hold out West," said David Crowe, NAHB's chief economist, who notes that monthly regional moves can be more dramatic. A three-month running average, however, still puts the West ahead of the rest of the nation.
Builders out West have also been heartened by a huge drop in distressed properties, thanks to an influx of large-scale investors looking to reap the rewards of a growing single-family rental market. As supplies of homes for sale drop there precipitously, the builders are moving in again.
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